Lower Your Mortgage with a VA Refinance Home Loan

If you have already qualified for a VA home loan, and you later find a loan at a lower interest rate, you can use an IRRRL for a VA refinance home loan and save on your monthly payments. The Interest Rate Reduction Refinancing Loan, or IRRRL, from the Veterans' Affairs department allows veterans with existing home loans  to refinance and lower their mortgage payment.

The VA will grant you an IRRRL if your new loan meets one of the following conditions:

  • You have a fixed-rate mortgage, and you find another fixed-rate mortgage with a lower interest rate. Over time, the lower interest rate adds up to less interest over the life of your loan, which will decrease the amount of your monthly payments.
  • You have an adjustable rate mortgage, and you find a fixed rate mortgage. The initial interest rate on the fixed-rate mortgage does not need to be lower than your existing adjustable-rate mortgage, but since it is a fixed-rate mortgage, it will remain stable, so it most likely will save you money in the long run.

To qualify for an IRRRL, your existing home loan must have been a VA loan, and you will need to use the home in question as your main residence. However, unlike with your original VA home loan, you will not have to prove your veterans' eligibility status. You may also be able to add up to $6,000 onto the cost of your refinanced home loan if you want to make any energy-efficiency home improvements.