A VA Streamline loan, also known as a VA IRRL (for “interest rate reduction loan” is designed to allow a veteran to refinance his or her current VA loan into a loan with a lower interest rate and lower monthly payment.

This type of refinance must be a VA to VA refinance. It’s called a “streamline” because there is no appraisal required and no income verification needed.

The veteran must save money in their mortgage payment each month and most importantly, the veteran must be able to make up all closing costs within 36 months.

This rule protects veterans from predatory lenders that charge exorbitant fees to get a low rate. To qualify for a VA IRRL, the borrower’s rate must drop by a minimum of .5% and they are not able to get any cash out of the refi.

Please remember that rates and fees can and will vary from lender to lender, so shop that mortgage around and be sure to include your trusted local lender, Indigo Mortgage Colorado.