The VA Interest Rate Reduction Refinance Loan (IRRRL, or "VA Streamline") refinances an existing VA loan on a DC home to a lower rate or from an ARM to a fixed rate, without an appraisal or income verification.
How an IRRRL compares with a standard refinance
The IRRRL skips the appraisal and income verification a standard refinance requires:
| Feature | Standard Refinance | VA IRRRL |
|---|---|---|
| Appraisal | Required | Not required by VA (lender may order one) |
| Income verification | Required | Not required |
| Credit underwriting | Full review | Minimal (lender may pull credit) |
| Occupancy | Must be primary residence | Must have been primary when you got the VA loan |
| Timeline | Full underwriting | Shorter: no appraisal, minimal underwriting |
| Funding fee | 2.15–3.3% | 0.5% |
IRRRL eligibility requirements
The IRRRL is available if you:
- Have a current VA loan: The loan being refinanced must be VA-guaranteed
- Show a net tangible benefit: at least a 0.5-point rate drop fixed-to-fixed (2 points if moving to an ARM), or a move from ARM to fixed, and closing costs recouped from the payment saving within 36 months
- Are current on payments: No more than one 30-day late payment in the past 12 months
- Are seasoned: Six payments made and 210 days past the first payment due date on the existing VA loan
Note: You do not need a new Certificate of Eligibility. Your existing VA loan establishes your eligibility.
The 36-month recoupment test
VA's 36-month recoupment test requires that closing costs be recovered from the monthly payment reduction within three years, or the loan does not qualify. The payment reduction depends on the difference between your current rate and today's rate, your balance, and how much of the drop comes from resetting the loan term. The 0.5% funding fee, which can be rolled into the balance, counts against the reduction.
Enter your loan details in the refinance calculator.
IRRRL costs and features for DC homes
Closing costs
IRRRL closing costs are lower than a standard refinance because there is no appraisal and less underwriting. DC also charges no recordation tax on a residential refinance under D.C. Code § 42-1102(21) with the ROD 21 affidavit. See our recordation tax guide.
No VA appraisal requirement
When the lender does not require an appraisal, a low value on a condo or an unusual property cannot stop the loan.
Timeline
No appraisal and minimal underwriting shorten the timeline, which helps if you have PCS orders or a deployment coming.
Condos
A standard VA refinance requires the condo to be on the VA-approved list. An IRRRL on an existing VA loan does not trigger a new condo review, so a DC condo owner can use an IRRRL even if the building is no longer VA-approved.
IRRRLs for service members stationed in DC
Veterans and active-duty service members stationed at Joint Base Anacostia-Bolling, the Washington Navy Yard, Fort McNair or other DC commands can use an IRRRL on a DC home that already has a VA loan.
Other IRRRL rules
No cash out
The IRRRL only changes the rate or term. For cash, use a standard VA cash-out refinance.
Occupancy after a move
The property only needs to have been your primary residence when you originally obtained the VA loan, so a home you rented out after PCS orders still qualifies.
Entitlement used on a second property
An IRRRL uses no new entitlement; it refinances your existing VA-guaranteed mortgage, so entitlement used on another property does not block it.
Funding fee exemption
Veterans receiving VA disability compensation are exempt from the 0.5% IRRRL funding fee and the funding fee on all other VA loans. Surviving spouses receiving DIC, Purple Heart recipients and the other categories listed on VA.gov are also exempt.
Steps to apply for an IRRRL
- Gather your current VA loan details: rate, balance and payment history
- Compare current rates to your existing rate
- Ask us about an IRRRL
- Send the documents requested, starting with your current mortgage statement
- Close on a shorter timeline than a standard refinance
Read the VA loans overview or get pre-qualified. It takes two minutes and does not pull your credit.
