VA Loan Refinance Options
VA borrowers have two main refinance paths. The IRRRL, or VA streamline, lowers your rate or moves you from an adjustable to a fixed rate with reduced paperwork and no cash back. The VA cash-out refinance replaces your loan, VA or not, and lets you take cash from your equity.
Key Takeaways
- The IRRRL requires an existing VA loan, has a 0.50% funding fee and generally needs no appraisal.
- The VA cash-out refinance has a 2.15% funding fee for first use and 3.30% for subsequent use.
- Veterans exempt from the funding fee, such as those receiving VA disability compensation, are exempt on both.
- Both loans have seasoning, credit and payment-history rules. Use the linked guides for details.
IRRRL vs. VA cash-out: which one is for me?
| Feature | VA IRRRL (streamline) | VA cash-out refinance |
|---|---|---|
| Purpose | Lower rate, or change ARM to fixed | Take equity as cash, or refinance a non-VA loan into a VA loan |
| Existing loan | Must be a VA loan | Can be VA or non-VA |
| Funding fee | 0.50% | 2.15% first use, 3.30% subsequent use |
| Appraisal | Not required in most cases | Required, plus termite inspection where applicable |
| Cash back | No (up to $6,000 for energy-efficiency improvements possible) | Yes; VA allows up to 100% of reasonable value, though many lenders cap lower |
| Seasoning | Later of 210 days from first payment and 6 payments made | VA and lender rules apply |
| Credit | Lender-set; 580 for loans up to $1,000,000, higher for larger loans | Lender-set; some programs start as low as 580 |
How does the VA IRRRL work?
The Interest Rate Reduction Refinance Loan is for veterans who already have a VA loan. Key rules, in general terms:
- No 30-day mortgage lates in the past 12 months.
- Fees must be recouped within 36 months.
- Fixed-to-fixed requires a rate at least 0.50% lower. Fixed-to-adjustable requires at least 2.00% lower. Adjustable-to-fixed has no minimum drop, so the new fixed rate may be higher.
- The new term cannot exceed the original term plus 10 years, and not more than 30 years and 32 days.
- If the principal and interest payment rises by more than 20%, income verification applies.
Read VA Streamline Refinance IRRRL guidelines and credit requirements and the VA IRRRL program guide. For help choosing between loan types, see IRRRL vs. conventional refinance.
How does the VA cash-out refinance work?
A VA cash-out refinance replaces your current loan with a new VA loan and pays you the difference. It can also move a conventional or FHA borrower into a VA loan. An appraisal is required. Funds are used for repairs, debt payoff or other needs. Read VA Cash Out Refinance guidelines and credit requirements and what is a VA cash-out refinance. Compare it with a general cash-out refinance to see the trade-offs.
What do these loans have in common?
- The funding fee can be financed and some veterans are exempt. See the VA funding fee.
- Eligibility and your Certificate of Eligibility apply. See how to get your COE.
- Seasoning applies to both. See how long to wait before refinancing a VA loan.
- Always compare costs against savings using the break-even calculator.
All VA refinance guides
- VA Streamline Refinance IRRRL Program
- Documents needed for a VA Streamline Refinance IRRRL
- How to qualify for a VA Streamline Refinance IRRRL
- VA Streamline Funding Fee
- VA Loan Eligibility Guidelines
- VA Loan Certificate of Eligibility
- VA Streamline Refinance IRRRL Guidelines and Credit Requirements
- VA Cash Out Refinance Guidelines and Credit Requirements
For the broader chapter, return to refinancing a home, or review the costs of refinancing.
At Lendia, we help veterans pick the right VA refinance
At Lendia, we compare VA refinance options from multiple lenders, check seasoning and credit first, and show your break-even before you commit. A Licensed Lendia California Loan Officer will tell you if staying in your current loan is better. Contact us or get a rate quote now.
Frequently Asked Questions
Do I need an appraisal for a VA IRRRL?
In most cases no. The VA cash-out refinance does require an appraisal.
Can I take cash out with an IRRRL?
No. IRRRLs do not provide cash back, aside from up to $6,000 for energy-efficiency improvements in some cases.
Can I refinance a non-VA loan into a VA loan?
Yes, through a VA cash-out refinance if you are eligible and qualify.
What is the VA funding fee on a refinance?
The IRRRL fee is 0.50%. The cash-out fee is 2.15% for first use and 3.30% for subsequent use. Exemptions apply to some veterans.
How do I know if I have remaining entitlement?
Your Certificate of Eligibility shows it. See the VA loan entitlement guide.
Rates and terms depend on your situation; approval requires qualification.
Talk to a Licensed Lendia California Loan Officer
At Lendia, we review your situation and show you the programs you qualify for.