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Refinancing a VA Loan

Crofton Real Estate Q & A

Q.  My current mortgage is 6.5% VA, with about 20 years remaining.  Should I refinance?

Money HouseA.  You should talk to a mortgage lender to find out if the numbers work for you.  Ask if your payment will go down or, if you get a 15–year loan, how much will you save by cutting five years of payments.

Refinancing a VA loan does not require the full loan application process.  Instead, you can get an Interest Rate Reduction Refinancing Loan (IRRRL).  Alan Gross, of Prime Lending in Gaithersburg, explains…


Refinancing A VA Loan. What is an IRRRL?

So what is a IRRRL? It’s the term used to refinance a VA Loan to lower the interest rate or switch from an Adjustable Rate Loan to a Fixed Rate Loan. IRRRL is short for Interest Rate Reduction Refinancing Loan.

VA does not require that an appraisal be or credit information be completed. But in today’s economy with house values having dropped in many parts of the country and many people struggling the lender may require both an appraisal and credit check be completed.

The IRRRL must always be a fixed rate loan. It can be for a 30 or 15 year term. The payment on the new loan must be less than the current payment unless the loan is being refinanced from an ARM to a fixed rate or the new loan term has shorter term than the current loan.

You may choose any lender that handles VA Loans to assist you with your IRRRL. There is no requirement that you go with the lender collecting your payments or the lender that originally did your loan.

Since you already have a VA Loan, no Certificate of Eligibility is required.

The IRRRL loan can include the existing loan balance, allowable fees and charges, up to $6,000 of energy efficiency improvements and the VA Funding Fee (May be waived in some ciricumstances.)

For more information on VA Loans go to:

Alan Gross 
PrimeLending, A PlainsCapital Company
Office Phone: (240) 813-0614

If you’re undecided about refinancing, why not check with Alan or another lender who can help.

Reposted with permission.


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