By: Mutual of Omaha Mortgage
VA Refinance Loan FAQ
Here are some frequently asked questions about VA refinance loans. This is a refinance option that is only available to homeowners who currently have a VA home loan.
What is a VA streamline refinance?
The VA streamline refinance loan is also known as the VA IRRRL. The VA streamline refinance is often a simple loan process because the borrowers are refinancing from one VA mortgage loan to another VA loan. This loan is often also referred to as VA-to-VA Loan. A VA streamline refinance is not available to homeowners who do not currently have a VA mortgage loan. The VA streamline refinance loan does not require that the borrowers occupy the home which is currently financed with a VA mortgage product.
What is a VA irrrl?
The VA IRRRL loan is also known as the VA refinance or the VA streamline refinance. The acronym IRRL stands for interest rate refinance reduction loan. The VA IRRRL loan or VA streamline refinance is a special type of refinance loan made available by the VA Loan Guaranty program. The VA IRRRL loan is a fixed-rate refinance loan program. This loan is ideal for homeowners who currently have a VA mortgage loan who are looking to lower their monthly interest rate.
Can you refinance a VA loan?
Yes, if you are currently a homeowner whose property is financed via a VA mortgage loan you can apply for a conventional, FHA or VA refinance. Depending on the rate and terms a borrower is seeking, they have the option to review any type of refinance loan to replace their current VA mortgage loan.
How soon can you refinance a VA loan?
Depending on the level of risk associated with a borrower, most lenders would typically require the homeowner have their current VA mortgage loan for a minimum of 12 months prior to applying for a refinance. Payment history is one of the most crucial factors in determining a borrower’s risk level for a VA refinance.
Can I refinance my mortgage with a VA loan?
Yes, if you are actively serving military, honorable discharge, veteran or the surviving spouse of any of the previous who is currently the borrower of a VA home loan you may refinance your property with a VA streamline refinance or VA IRRRL loan. The VA streamline refinance or VA IRRRL loan is only available to homeowners who currently have a VA mortgage loan. VA refinance loan products are not available to civilians or the general public.
Can I refinance a conventional loan to a VA loan?
Yes, a borrower who is eligible for VA benefits can refinance from a conventional loan to a VA loan. Although this is not typical, there is no restriction that prevents this. To be eligible for a VA loan a borrower must be actively serving in the U.S. military, honorable discharge, veteran or the surviving spouse. If a borrower who currently has a conventional loan opts to refinance with a VA loan the loan process could take longer than average because different documentation will need to be reviewed that was not previously received and underwritten by a VA approved lender.
When to refinance VA loan?
The decision to refinance a home should not be taken lightly. It is important for a homeowner to evaluate and determine their financial goals. If a homeowner is seeking the opportunity to lower their monthly interest rate or transition from an adjustable rate mortgage loan to a fixed rate program, then a refinance could be a great opportunity. Speaking with an experienced loan originator can help a borrower review their income, assets, and debt to determine if a refinance is the right decision.
How long does it take to refinance a VA loan?
TIf a VA borrower uses the VA IRRRL loan or VA streamline refinance, the entire process can be completed in 30 to 45 days. Although the VA streamline refinance or VA IRRRL loan does not require income verification, in order for the VA refinance process to move forward, a borrower must have the following qualifications:
- VA Loan eligibility of the borrower must have been used on the property intended for refinance
- Most recent two years of W-2 statements to establish income
- Ability to document current or previous occupancy of the property
- Confirmation of currency on mortgage payments or no more than one late payment in the last 12 months