A VA Streamline IRRL loan, also known as a VA IRRL (for “interest rate reduction loan”) is a loan designed for a veteran to refinance his or her current VA loan into a loan to get a lower interest rate and lower monthly payment.

The IRRL refinance must be a VA to VA refinance. It’s known as a “streamline” because there is no appraisal required and no income verification needed.

The veteran must save money in their mortgage payment each month and most importantly, the veteran must be able to recoup all closing costs within 36 months.

The 36-month rule protects veterans from predatory lenders that charge exorbitant fees to get a low rate. To qualify for a VA IRRL, the borrower’s rate must drop by a minimum of .5% and they are not able to get any cash out of the refi.

Mortgage rates and fees can and will vary from lender to lender, so always shop your mortgage around to find the best rates and lowest fees. And be sure to include your trusted local lender, Indigo Mortgage, serving New Mexico since 2003.