How Does the VA IRRRL Streamline Refinance Work, and What Are Its Requirements?
A VA interest rate reduction refinance loan (IRRRL), often called a streamline refinance, lets you refinance an existing VA loan into a lower rate or a more stable payment, with no cash out. VA itself doesn't require a new appraisal or income check, though lenders may. Your current loan has to be seasoned, and the new rate has to pass VA's benefit test. Closing costs can usually be rolled into the loan.
Last updated September 29, 2026How is an IRRRL different from a regular refinance?
It's only for refinancing an existing VA loan into a new VA loan. Because VA already guarantees the loan, some steps drop away: no cash out (that's a different VA loan), no VA-required appraisal and, in most cases, no new income or employment verification. You also don't have to live in the home now; you have to certify that you lived there at some point.
What are the seasoning rules?
Both of these have to be met: you've made at least six consecutive monthly payments on the current loan, and at least 210 days have passed since the first payment was due.
How much does the rate need to drop?
VA requires a net tangible benefit, measured by the type of change:
It depends on your situation:
- Fixed rate to fixed rate: the new rate has to be at least 0.5 percentage points lower.
- Fixed rate to adjustable rate: at least 2 percentage points lower.
- Adjustable rate to fixed rate: no minimum drop, because the stability counts as the benefit.
- In every case: the closing costs generally have to be recouped through the monthly savings within 36 months.
What does it cost?
The VA funding fee on an IRRRL is 0.5% of the loan, unless you're exempt, for example because you receive compensation for a service-connected disability. Closing costs and the fee can usually be added to the new loan, which keeps cash at closing low but makes the new balance a bit higher than the old payoff.
| Cash out | Not allowed |
|---|---|
| VA-required appraisal | None |
| Income and employment check | Not usually required |
| Occupancy | You must have lived in the home at some point |
| Seasoning | Six payments and 210 days since the first payment was due |
| Rate drop, fixed to fixed | At least 0.5 points |
| Rate drop, fixed to adjustable | At least 2 points |
| Cost recoupment | Within 36 months |
| Funding fee | 0.5%, unless exempt |
Related questions
- what's the Difference Between an FHA Loan and a Conventional Loan
- can You Reuse Your VA Loan Entitlement to Get Another VA Loan on a Different Property
- how Do DD-214 Status, an Early or Incomplete Discharge, or Being a Veteran's Dependent Affect VA Loan Eligibility
- does an FHA Streamline Refinance Require an Appraisal or Income Verification
- minimum credit score to qualify
Sources
- https://www.va.gov/housing-assistance/home-loans/loan-types/interest-rate-reduction-loan/
- https://www.benefits.va.gov/homeloans/irrrl.asp
- https://www.benefits.va.gov/HOMELOANS/documents/circulars/26_19_22.pdf
- https://www.benefits.va.gov/HOMELOANS/documents/conf/2023-lender-d2-02-refinancing-loans.pdf
- https://www.va.gov/housing-assistance/home-loans/funding-fee-and-closing-costs/
Sourced from licensed loan officers and brokers in the FreeRateUpdate network.
Educational information only, not individualized financial or legal advice. Program details and rates change; verify current terms with a licensed loan officer before making a decision.