VA to VA Refinance Loans “IRRRL”
Texas VA refinances loans or the VA Streamline Refinance Program also known as an IRRRL (pronounced “Earl”). It stands for Interest Rate Reduction Refinancing Loan. This loan is a refinance loan used to reduce your interest rate on a current VA mortgage. This loan can also be used to refinance from an Adjustable Rate Mortgage in to a Fixed Rate Mortgage. The “IRRRL” is a program specifically created for veterans refinancing from an existing VA loan to a new VA loan. If a veteran is looking at converting from a conforming loan to a VA loan is would not be considered an “IRRRL” it would just be a standard VA loan and would have to go through the full underwriting process including appraisal. The “IRRL” is our most popular VA refinance program. (If your current loan is not a conventional loan and you want to refinance to VA, you will need to refinance under the full VA Cash Out Refinance Program.
Some of the reasons the “IRRRL” is so popular are the following:
* The appraisal is usually the only out-of-pocket expense (and is usually waived)
* In most cases we can go as low as 620 mid Fico score
* A full credit report is NOT required (only the mortgage history)
* Income information is NOT usually required (just current employer, if applicable)
* Asset information is NOT usually required
* Debt information is NOT usually required (except current mortgage)
* VA Certificate of Eligibility is NOT required
* Owner occupancy is NOT required
The Following must be present and documented:
* Current loan is a VA or Texas Vet VA loan
* Current loan balance is at least $50,000
* NO past due balances on your current VA mortgage
* NO late mortgage payments for the last 12 months
* NO cash back at closing
As of July 2010, a full conventional property appraisal may be required on your VA streamline refinance loan. If so, your property must appraise for at least your new loan amount, including the VA funding fee (if applicable) and the cost of the appraisal will be due before the appraisal is ordered.
An” IRRRL” may be done by rolling in most of the costs into your new loan; however, the cost of the appraisal is typically an out-of-pocket expense. The only cost directly to the VA is the funding fee of 0.50%, which may be waived for disabled vets and which may be included in the new loan amount or paid in cash at closing.
Conventional to VA Refinance
It’s ok to refinance your traditional or conventional mortgage to a VA mortgage. Unlike a VA to VA reifi as described above, the process is a bit different. Income, assets and credit score are verified and an appraisal has to be ordered in order to get approved.