A VA Interest Rate Reduction Refinance Loan — or IRRRL — is often called a “VA streamline refinance” because the lending approval process is greatly simplified. An IRRRL doesn’t require an appraisal or go through the typical VA lender underwriting process. That saves a lot of time, paperwork and fees.
A VA IRRRL is used to refinance one VA Mortgage into another. The idea is to lower your current VA rate with very little headache. With it, you get a lower rate, a lower payment, or both. You can also move from an adjustable-rate loan to a fixed-rate loan.
Lenders love IRRRLs. Borrowers do, too, because they are much easier to navigate than regular VA loans.
You can’t, but there’s an exception: Up to $6,000 in cash can be taken out from your IRRRL for energy-efficient improvements. A lender may require an energy audit of your home to prove the upgrades will provide a real return on investment.
Other than that, there are no other cash-out options on an IRRRL. Your closing costs can be rolled into your loan balance or priced into your interest rate, just like any other VA home loan.