VA Loan Blog

VA IRRRL: How to Get the Best VA Interest Rate Reduction in 2023

Are you a veteran or active-duty service member looking to refinance your existing VA loan? The VA Interest Rate Reduction Refinance Loan (IRRRL), also known as a VA streamline refinance loan, may be just the solution you need. In this guide, we'll explore the ins and outs of VA IRRRL, its eligibility criteria, costs, and how to maximize its benefits. Let's dive in and discover how the VA IRRRL can help you achieve a more manageable monthly payment and potentially save you thousands of dollars in the long run.

Short Summary

  • VA IRRRL is designed to help VA loan holders refinance for a lower interest rate.

  • Eligibility criteria include active duty service members, at least seven months of current VA loans, and no late payment in the past 12 months.

  • Using a trusted VA Lender, like us, and understanding ARM vs. Fixed Rate Mortgage options are essential to maximizing benefits from the program.

Understanding VA Interest Rate Reduction Refinance Loan (IRRRL)

An image showing the VA Interest Rate Reduction Refinance Loan (IRRRL) logo, which is a symbol of va interest rate reduction program.

The VA IRRRL, also known as the VA Streamline Refinance, is designed to help those with existing VA loans refinance to a lower interest rate with minimal hassle. This refinance loan has a quicker process and is more straightforward than a typical refinance. To be eligible for a VA IRRRL, you must be current on your mortgage payments which have been live for at least seven months or 210 days.

By refinancing through VA IRRRL, you can potentially lower your monthly payments and save money over time. We've been helping people get va backed loans for over 20 years and can help you with the different refinance options to find one that suits you best.

VA IRRRL Eligibility Criteria

google search for va irrrl streamline refinance eligibility, looking for va irrrl cost, va backed home loan refinance current loan for va borrowers

To qualify for a VA IRRRL, you must meet several eligibility criteria. These include possessing a current VA loan that has been open for at least 7 months (210 days), having no late payments in the past 12 months, and using the home as your primary residence.

Sorry, investment property doesn't work for these loans, but you can move out and rent the residence after you get the VA IRRRL refinance completed. Either way, you can save on your current mortgage, so that's a plus.

The new loan must also demonstrate a clear financial advantage, such as a lower interest rate or a more manageable monthly payment. Additionally, you must be an active-duty service member or veteran with a certain length of service and honorable discharge.

Occupancy Requirements

For VA IRRRL, there is no occupancy requirement post-closing, which means you don't have to live in the property after refinancing. However, you must attest that you previously resided in the home as your primary residence.

So, back to the investment property question. You can move out of the property afterward and rent out the home. Airbnb or a property management company could help make this rather profitable, especially around the more desirable parts of the Puget Sound.

VA IRRRL Costs and Fees

A person looking at VA IRRRL costs and fees, wallet showing a tape measure wrapped around it, constraints on wallet due to mortgage payment and mortgage insurance

Like any refinancing option, VA IRRRL comes with some costs and fees. One such cost is the VA funding fee, which amounts to 0.5% of the loan amount. This fee helps cover the cost of the loan and is specified by the Department of Veterans Affairs.

In addition to the funding fee, there are closing costs, which typically include origination fees, discount points (if applicable), and credit report fees. You can pay these costs upfront or include them in your new loan.

If you include the origination fee into the loan amount, it makes it so you can have a new home loan without a down payment or any cash out of your pocket.

Some veterans may be exempt from the funding fee, as we'll discuss in the next subsection. It's also worth noting that in some cases, the lender may absorb the VA loan costs in exchange for a higher interest rate on the loan. This can be an attractive option for those who want to minimize their out-of-pocket expenses during the refinancing process.

Funding Fee Exemptions

Certain veterans are exempt from paying the VA IRRRL funding fee. These include veterans who qualify for disability services through the VA, active-duty members of the military who have been awarded the Purple Heart, and some surviving spouses of veterans who passed away while serving.

If you fall into one of these categories, you can save a significant amount of money by not having to pay the 0.5% funding fee.

Steps to Apply for a VA IRRRL

A person looking at steps to apply for a VA IRRRL to reduce their existing loan, Asking mortgage lenders for a lower monthly payment without va irrrl funding fees and to refinance loans

Applying for a VA IRRRL is a relatively simple process. To get started, you'll need to locate a lender that offers VA Streamline Refinance and contact them. The lender will provide you with the necessary forms to complete the application process. Keep in mind that closing costs may vary depending on the lender and the loan terms, so it's essential to compare different lenders to find the best deal.

One of the advantages of VA IRRRL is the option to include energy-efficient improvements in your refinancing. Let's explore this further in the next subsection.

Energy-Efficient Improvements

When refinancing through VA IRRRL, you have the opportunity to include energy-efficient improvements in your loan, up to a maximum cost of $6,000. These improvements may consist of installing energy-efficient windows, doors, insulation, and HVAC systems.

By incorporating energy-efficient upgrades into your refinancing, you can not only increase the value and comfort of your home, but also lower your energy bills and contribute to a greener environment.

Comparing VA IRRRL Lenders

handshake after refinancing existing mortgage with our mortgage company, getting a new va loan with the same loan balance but a lower monthly mortgage payment

It's crucial to compare VA IRRRL lenders to ensure you get the best rates and fees. Interest rates, rules, and requirements may differ from one lender to another, and some lenders may require credit and income approval even though the VA does not. Choosing the right lender can make all the difference when it comes to availing the full set of VA IRRRL benefits. We've been helping veterans with VA loans for over 20 years in the JBLM area and can help anyone in Washington state with their VA loans or IRRRL.

The Department of Veterans Affairs offers a list of the most prominent VA loan lenders based on volume, which can be a helpful starting point in your search. For the most competitive VA refinance rates, it's recommended to compare personalized offers from at least 3-5 lenders. This will ensure you find the most advantageous deal for your situation.

Adjustable Rate Mortgage (ARM) vs. Fixed Rate Mortgage

A person comparing an adjustable rate mortgage and a fixed rate mortgage, the balance leans to the fixed rate mortgage side to save on interest payments and improve personal finance

When considering a refinance, it's important to weigh the pros and cons of an adjustable rate mortgage (ARM) versus a fixed rate mortgage. The primary difference between the two is that the interest rate on an ARM can fluctuate, while the interest rate on a fixed rate mortgage remains constant throughout the entire loan period.

Choosing between an ARM and a fixed rate mortgage depends on your financial goals and risk tolerance. An ARM may initially offer a lower interest rate, which can result in lower monthly payments. However, when interest rates rise, your monthly payments may increase as well.

On the other hand, a fixed rate mortgage provides predictable payments over the life of the loan, which can be beneficial for budgeting purposes. It's essential to carefully consider your options and consult with a VA-approved lender to determine the best choice for your unique situation.

Maximizing Your VA IRRRL Benefits

A person maximizing their VA IRRRL benefits, va compensation

To maximize your VA IRRRL benefits, it's important to take advantage of lower interest rates and predictable payments. By refinancing to a lower interest rate, you can reduce your monthly payment and save money over time. Additionally, a fixed-rate mortgage offers stability and peace of mind, as your monthly payments will remain constant throughout the life of the loan.

Another crucial step in maximizing your VA IRRRL benefits is consulting with a VA-approved lender. They can help you navigate the refinancing process, understand the costs and fees involved, and ensure you're getting the best deal possible. By working with a knowledgeable lender, you'll be better equipped to make informed decisions and fully leverage the advantages of the VA IRRRL program.

Alternatives to VA IRRRL Refinancing

A person looking at alternatives to VA IRRRL refinancing and other va loans, looking at cash out refinance options instead of their current mortgage at a local credit union

While VA IRRRL refinancing offers numerous benefits, it's essential to consider alternative options as well. One such alternative is a home equity loan or a home equity line of credit (HELOC) for additional funds. These loans use the equity in your home as collateral and can be used to finance home improvements, pay off debt, or cover other expenses.

When evaluating your refinancing options, it's crucial to weigh the pros and cons of each and determine which best aligns with your financial goals and needs. Consulting with a VA-approved lender can provide valuable insights and guidance in making the right decision for your situation.

VA Streamline Refinance Loans vs. VA Cash Out Refinance Loan

While both the VA Streamline Refinance (IRRRL) and the VA Cash Out Refinance are valuable refinancing tools for homeowners, they serve distinct purposes and have different qualifications.

The VA Streamline Refinance, officially known as the Interest Rate Reduction Refinance Loan (IRRRL), is designed specifically to refinance an existing VA home loan into a new one with a lower interest rate, or from an adjustable-rate to a fixed-rate. It's a streamlined process that requires less paperwork and underwriting than a standard refinance, hence the name "streamline." However, it does not allow you to take cash out of your home's equity, and it can only be used to refinance an existing VA loan.

On the contrary, a VA Cash Out Refinance Loan allows eligible homeowners to refinance their current mortgage, whether it's a VA or non-VA loan, and simultaneously tap into their home's equity to access cash. This is beneficial for homeowners who need extra cash for purposes such as debt consolidation, home improvements, or other significant expenses.

In summary, the choice between a VA IRRRL and a VA Cash Out Refinance Loan largely depends on your individual needs, your current type of mortgage, and how you plan to utilize your home equity.


In conclusion, the VA Interest Rate Reduction Refinance Loan (IRRRL) offers a valuable opportunity for veterans and active-duty service members to refinance their existing VA loans with minimal hassle.

By understanding eligibility criteria, costs, and benefits of VA IRRRL, and considering alternative options, you can make the most informed decision on your refinancing journey. Take advantage of the VA IRRRL program today and start enjoying lower monthly payments and potential savings that can significantly impact your financial future.

Call us for any questions or if you'd like to see what your refinance options are.

Frequently Asked Questions

What is a VA interest rate reduction?

A VA Interest Rate Reduction Refinance Loan (IRRRL) is a mortgage refinance program offered by the U.S. Department of Veterans Affairs that helps veterans who already have a VA home loan reduce their monthly mortgage payments and stabilize their payments with a lower interest rate.

This loan program offers veterans an opportunity to take advantage of the current low-interest rates.

What is VA Streamline interest rate reduction program?

The VA Streamline Refinance, otherwise known as the Interest Rate Reduction Refinance Loan (IRRRL), allows veterans and their families to refinance existing VA loans with lower interest rates. By taking advantage of this program, veterans can reduce their monthly payments and often lock in a lower interest rate.

Can veterans get lower interest rates?

Yes, veterans may be eligible for lower interest rates on mortgages, car loans, student loans, personal loans, and other types of financing. This can be done through negotiation with the lender for, or by paying a VA funding fee unless the veteran is exempt due to disability compensation. While no down payment is required, a VA refinance loan still has to go through the credit underwriting process.

How can I lower my VA interest rate?

To lower your VA interest rate, you can use a Department of Veterans Affairs (VA) Interest Rate Reduction Refinance Loan (IRRRL). A VA IRRRL allows borrowers to refinance an existing VA loan and get a lower interest rate.

This type of loan is available to veterans who have an existing VA loan and want to reduce their interest rate. It can also be used to refinance an adjustable-rate mortgage into a fixed-rate loan. The VA IRR.

Is the VA IRRRL program worth it?

Considering the potential benefits of a VA IRRRL, it may be worth pursuing if you can get a lower interest rate and more manageable monthly payments. Refinancing with this type of loan could save you money in the long run by reducing your total amount of interest paid over time.

Ultimately, only you can determine if a VA IRRRL is the best decision for your financial situation.

VA Cash-Out Refinance Loans

Your Path to VA Cash Out Refinance

Welcome to West Coast Veterans, your trusted VA lender based in Lacey, WA. We specialize in VA loans and are committed to guiding you through the VA cash out refinance process. Our dedicated team of experts can help you convert your home's equity into cash while ensuring you get the most out of the VA loan program.

What is VA Cash Out Refinance?

VA cash-out refinance, backed by the Department of Veterans Affairs, allows eligible VA borrowers like veterans and active duty service members to take advantage of their home equity and refinance their existing mortgage. This unique VA program provides an opportunity to access cash for any purpose, from funding home improvements to consolidating debt.

Qualifying for a VA Cash Out Refinance

Wondering if you're eligible for a VA cash-out refinance loan? As part of the broader VA home loan offerings, this option is open to veterans, active duty service members, and surviving spouses who meet service requirements. A valid Certificate of Eligibility (COE) is required. Additionally, you should reside in the primary residence being refinanced and meet certain credit score and debt-to-income criteria.

Why Choose VA Cash Out Refinances?

Debt Consolidation

VA cash-out refinance loans are an excellent solution for consolidating high-interest debt into a lower monthly payment, potentially saving you more money in the long run. Why juggle multiple interest payments when you can streamline your personal finance management with one fixed-rate mortgage?

A man painting his room after refinancing his current loan with West Coast Veterans mortgage lenders.

Home Improvements

Are you planning to increase your home's value with some necessary renovations? VA cash-out refinance can provide the funds to cover these costs, transforming your home equity into a home improvement resource.

Escaping an Adjustable Rate Mortgage

Yes, you can transition from an adjustable-rate mortgage to a fixed-rate mortgage through a VA cash out refinance loan. This move can be advantageous if you want the stability of knowing exactly what your payment will be each month and possibly have lower monthly payments and a lower interest rate. However, your loan terms may change.

VA Cash Out Refinance vs. VA IRRRL Refinance

While both the VA Cash Out Refinance and the VA Interest Rate Reduction Refinance Loan (IRRRL) or VA Streamline Refinance are valuable tools for homeowners, they serve different purposes and have distinct requirements.

A VA Cash Out Refinance allows eligible homeowners to refinance their current mortgage, regardless of whether it's a VA loan or non-VA loan, while also turning their home equity into cash. This means you can borrow more than your existing loan balance, using the extra cash for any purpose, such as consolidating debts or making home improvements.

On the other hand, a VA IRRRL is used exclusively to refinance an existing VA loan into a new VA loan with a lower interest rate or to transition from an adjustable-rate mortgage to a fixed-rate mortgage. The primary objective of a VA IRRRL is to lower your monthly mortgage payments. It's a more streamlined process with less documentation required, but it does not provide cash back from your home equity.

In essence, if you have a VA loan and wish to lower your interest rate without taking cash out, the VA IRRRL could be a better fit. However, if you have significant home equity that you'd like to tap into or if you want to refinance a non-VA loan, the VA Cash Out Refinance would be the appropriate choice.

VA Cash Out Refinance vs. Conventional Loan

Compared to a conventional mortgage, a VA cash-out refinance loan typically offers lower interest rates and does not require private mortgage insurance (PMI) like a conventional loan. There's a lot of commonality between the different va loans. Additionally, it allows you to borrow up to 100% of your home's value, compared to 80% with most conventional loans.

VA Cash Out Refinance Loan vs. Home Equity Loan

Both VA cash out refinance loans and home equity loans can provide access to cash using the equity in your home. However, they differ in key ways. A VA cash out refinance loan replaces your current mortgage with a new one for a higher amount, and you receive the difference in cash. This allows you to take advantage of potentially lower interest rates compared to your existing mortgage, while also giving you access to extra funds.

On the other hand, a home equity loan, sometimes called a second mortgage, is a separate loan in addition to your existing mortgage. You receive a lump sum that you repay over a fixed term, usually at a fixed interest rate. While this can also be a good way to access cash, it generally comes with higher interest rates compared to VA cash out refinance loans and adds a second monthly payment to your budget.

In summary, if you want to both refinance your existing mortgage and access your home equity, a VA cash out refinance loan may be the most advantageous choice.

Understanding the VA Origination Fee

The VA origination fee, often referred to as the VA funding fee, is a one-time charge by the Department of Veterans Affairs for the service of providing you with the VA-backed loan. This fee helps reduce the burden on taxpayers and ensures the sustainability of the VA loan program for future generations of military personnel. It's important to note that some individuals, such as veterans with a service-related disability, may be exempt from this funding fee.

credit score for va streamline loan, picture of a good credit score used for va refinance or cash out refinances

Minimum Credit Score for VA Cash Out Refinance Loan

In the realm of VA cash-out refinance loans, credit scores are crucial. While the Department of Veterans Affairs does not mandate a minimum credit score for VA loans, most lenders, including West Coast Veterans, do. Generally, a credit score of 620 is the typical minimum score required by most VA lenders for a VA cash-out refinance loan. However, it's important to note that credit score is just one of many factors considered in the approval process. Factors such as your income, debt-to-income ratio, and the amount of home equity you possess are also important.

Navigating the VA Cash Out Refinance Process with West Coast Veterans

Our expert team at West Coast Veterans can walk you through the VA streamline refinance process step-by-step, from verifying your eligibility and getting a home appraisal, to finalizing the refinance loan. We're here to make the transition smooth, ensuring you understand all aspects, including closing costs, VA funding fee, and how your interest rate may change.

Considerations for VA Cash-Out Refinances

While the VA loan program offers numerous benefits, it's important to weigh a few key considerations before opting for a VA cash-out refinance loan. These include potential changes to your interest rate, a longer loan term, the impact of closing costs, and the implications for your overall credit score. At West Coast Veterans, we're committed to providing all the information you need to make an informed decision and help you save money.

In Summary

At West Coast Veterans, we're proud to offer VA cash-out refinance loans as a part of our commitment to serving veterans and active-duty service members. If you're considering a VA cash out refinance, we're here to help, from the initial stages through to the final steps of securing your new loan.

For further information or to start your journey towards VA cash out refinancing, get in touch with our team today.

Who is a VA Cash Out Refinance Loan For?

A VA Cash Out Refinance Loan is designed for eligible veterans, active-duty service members, and surviving spouses who want to tap into the equity built up in their homes for any purpose. It's an ideal choice for those who are seeking to consolidate high-interest debt, make substantial home improvements, or cover significant expenses such as education or medical bills.

This loan can also be a beneficial choice for those with a non-VA loan, such as a conventional or Federal Housing Administration (FHA) loan, who want to refinance into a VA loan to take advantage of its benefits, including potentially lower interest rates and no requirement for private mortgage insurance.

Moreover, if your existing mortgage has an adjustable interest rate and you prefer the predictability of a fixed-rate loan, a VA Refinance can help you achieve that stability. The eligibility criteria, including the minimum service requirements, can be reviewed with our team at West Coast Veterans.

Who is a VA Cash Out Refinance Loan Not For?

While VA Cash Out Refinance loans offer numerous benefits, they're not the ideal solution for everyone. If you have a VA loan and are solely interested in reducing your interest rate or changing from an adjustable-rate mortgage to a fixed-rate mortgage without accessing your home's equity, you might find a VA Interest Rate Reduction Refinance Loan (IRRRL) or VA Streamline Refinance a better fit due to its streamlined process.

Also, these loans are not ideal for those who have little to no equity in their homes. Since the cash you receive from a VA cash out refinance is based on your home's equity, those with minimal equity may not receive enough funds to make the refinancing process worthwhile.

Finally, individuals who do not meet the VA's eligibility criteria, such as veterans who do not meet the minimum service requirements or civilians without military service, would not qualify for a VA Cash Out Refinance Loan.

Remember, while VA loans offer many advantages, they also come with responsibilities. They may not be suitable for those who are not prepared for the costs associated with closing costs, the VA funding fee, or potential changes to payment amounts or terms. Always consider your financial situation and long-term goals before proceeding with a refinance.

military service members faq, qualified veterans faq, eligible borrowers faq

Frequently Asked Questions

  1. Who qualifies for VA cash-out refinance loans at West Coast Veterans? Veterans, active-duty service members, and surviving spouses who meet the service requirements are eligible.

  2. What can the cash from a VA cash-out refinance be used for? The funds can be used for any purpose, including home improvements or debt consolidation. What you spend money on isn't really a concern for the financial institution.

  3. What costs are associated with a VA cash-out refinance at West Coast Veterans? Costs include the VA funding fee, closing costs, and any points you might pay to lower your interest rate.

  4. Does a VA cash-out refinance affect my credit score? The process involves a hard credit inquiry, which can temporarily lower your score.

  5. Can the closing costs of a VA cash-out refinance be rolled into the loan? Yes, these costs can often be incorporated into the total loan amount, avoiding upfront out-of-pocket expenses.

  6. Can a surviving spouse get a VA IRRRL loan? Yes, surviving spouses who have assumed a VA-backed loan are eligible for a VA IRRRL.

  7. What does VA IRRRL stand for? VA IRRRL stands for Veterans Affairs Interest Rate Reduction Refinance Loan. It's often referred to as a VA Streamline Refinance.

  8. Can I qualify for a VA cash-out refinance loan? If you are a veteran, active-duty service member, or a surviving spouse who meets the service requirements, you can qualify for a VA cash-out refinance loan. Additionally, you should have sufficient home equity, a satisfactory credit score, and a reasonable debt-to-income ratio.

  9. Can I use a VA cash-out refinance loan for an investment property? Typically, VA loans, including the VA Cash Out Refinance, are designated for primary residences only. This means you're expected to live in the home. Therefore, they are generally not used for investment properties or vacation homes. If you have specific circumstances or questions about your property, it's best to consult directly with our experienced team at West Coast Veterans to understand all your available options.

VA Loans in Olympia, WA | Olympia’s Preferred Veterans Mortgage Lender

VA loans in Olympia, WA - West Coast Veterans helping others get a VA Loan

As a vibrant hub in Washington State, Olympia, provides a welcoming environment for military and veteran families. Among the numerous amenities offered, the accessibility to VA Loans, specifically from West Coast Veterans, significantly stands out.

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Understanding VA Loans

What are VA Loans?

VA Loans are home financing options that the Department of Veteran Affairs sponsors. These loans provide U.S. veterans, active-duty service members, and eligible surviving spouses with several advantages over traditional mortgages.

Benefits of VA Loans

VA Loans stand out with their no down payment requirement, saving borrowers a significant amount. Moreover, VA Loans don't require private mortgage insurance (PMI), leading to substantial savings in monthly payments.

West Coast Veterans: Your VA Loans Expert in Olympia, WA

Eligibility Criteria for VA Loans

West Coast Veterans provides VA Loans to veterans, active-duty service members, or a surviving spouse. Specifics can apply, so it's always best to check with West Coast Veterans for complete details.

How to Apply for VA Loans with West Coast Veterans

Starting your VA Loan process with West Coast Veterans in Olympia, WA, is simple. After obtaining your Certificate of Eligibility (COE) from the VA, you can easily connect with our team.

The Process of Getting VA Loans with West Coast Veterans

Step-by-step Guide to the VA Loan Process

The VA Loan process usually begins with prequalification, then preapproval, house hunting, purchase agreement, VA appraisal, underwriting, and finally closing the loan, all under the expert guidance of the West Coast Veterans team.

Documents Needed for VA Loans at West Coast Veterans

To proceed with your application, you'll need your COE, recent pay stubs, W-2s, and tax returns. The exact list may vary, and the West Coast Veterans team can guide you through it.

Why Choose West Coast Veterans for Your VA Loan

Unparalleled Service

Our team of experienced professionals is ready to assist you every step of the way, making your home buying journey smooth and stress-free.

Competitive Interest Rates

At West Coast Veterans, we strive to offer the most competitive rates in the market, ensuring you receive the best terms possible for your loan.

Tips for Getting the Best VA Loan Terms with West Coast Veterans

Understanding VA Loan Interest Rates

VA Loans don't have a fixed interest rate, but at West Coast Veterans, we ensure you get the most favorable rates according to market trends.

Frequently Made Mistakes by VA Loan Borrowers

To maximize your benefits, avoid common mistakes such as not understanding the full loan terms or skipping the preapproval stage. Our team can help you navigate these potential pitfalls.


VA Loans can be an invaluable tool for eligible individuals in Olympia, WA. With West Coast Veterans, you can navigate the process with ease and confidence, making your dream of homeownership a reality.

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  1. Who can apply for VA Loans at West Coast Veterans in Olympia, WA? Veterans, active-duty service members, and eligible surviving spouses can apply.
  2. Are VA Loans only for buying a house? No, they can also be used for refinancing and home improvements.
  3. What's the maximum amount I can borrow with a VA Loan from West Coast Veterans? There's no maximum limit for VA Loans, but we'll determine your loan amount based on your income and credit history.
  4. Do VA Loans have better interest rates? Generally, VA Loans offer competitive interest rates compared to traditional loans, but rates vary between lenders. At West Coast Veterans, we strive to offer the best rates possible.
  5. Can I apply for a VA Loan more than once with West Coast Veterans? Yes, you can use your VA Loan benefit multiple times, provided you've paid off the previous loan in full.