VA Loan Center of Texas, a Division of Mortgage Express,
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VA Loan Center of Texas
VA Loan Center of Texas
VA Loan Center of Texas

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VA Refinance

VA Streamline Refinance

VA Streamline (IRRRL)

One of the most popular refinance options in the market for veterans right now is what’s called a VA Streamline loan, also known as, an Interest Rate Reduction Refinance Loan (IRRRL). The benefits of this loan program are extraordinary and designed to be a quick and easy process from start to finish. Of course, there will be a normal loan application but not as much personal information is required.

Benefits of an IRRRL:

  • Lower your monthly mortgage payment
  • No income verification
  • No asset verification
  • Minimum 620 mid score
  • Very little closing costs
  • No appraisal required*

*Note: some restrictions may apply depending on your lender

The sole purpose of a VA streamline is to lower the interest rate and the mortgage payments for veterans that currently have an existing VA mortgage. Generally, an IRRRL is always a fixed rate and must give a lower interest rate than the loan it is refinancing unless the loan being refinanced is currently an Adjustable Rate Mortgage (ARM).

The following fees and charges can be included in an IRRRL:

  • The VA Funding Fee
  • Reasonable and customary amounts of fees allowed by the VA
  • A flat 1% flat charge by the lender
  • Reasonable discount points (maximum of 2 discount points are allowed)

What if you are currently behind on your VA mortgage?

For IRRRLs to refinance loans 30 days or more past due these loans must be given prior approval by the Department of Veteran Affairs. If the VA approves this request then the following can be included in the new loan:

  • Late payments and late charges of the old loan
  • Reasonable costs if any legal action to terminate the old loan has commenced

*Note: under the above mentioned circumstances regarding current mortgage late payments, the VA and Lender have the right to approve or deny the loan at their own discretion

Other important information regarding VA Streamline loans:

  • The new VA loan will always hold first lien position
  • No cash back allowed
  • No assumptions are allowed

Traditional Refinance

A traditional VA refinance is when the veteran’s current mortgage is a non-VA loan, and the intention is to lower the interest rate and possibly the monthly mortgage payment. All standard documentation requested by the VA for approval will apply to this loan program. Keep in mind, this refinance program allows a new loan up to 90% of the home’s appraised value, including all closing costs and VA funding Fee (if applicable). So, if a veteran is considering a traditional VA refinance then the appraisal is extremely important. If the subject property does not appraise for a value high enough to cover the current mortgage payoff, all closing costs, and the new funding fee then the veteran is responsible to pay the difference.

Types of mortgage loans that might be eligible for a VA refinance:

  • FHA loans
  • Conventional loans
  • Construction loans
  • Loans assumed by veterans at interest rates higher than that for the proposed amount

**The State of Texas does NOT allow VA cash out refinance loan at this time**