VA Streamline Refinance with No Appraisal
The VA Streamline Refinance program allows Veterans to refinance their current VA mortgage without the need for an appraisal. VA Streamline Refinances are also known as VA IRRRL. The acronym VA IRRRL stands for Veterans Administration Interest Rate Reduction Refinancing Loan. Technically, the VA does not require that lenders require a home appraisal with this program. Most lenders do have their own appraisal requirement for all VA refinances, including the VA IRRRL. For Veterans with a VA Mortgage in Pennsylvania, we do have available a VA Streamline Refinance without an appraisal.
Why do most lenders require an appraisal for the VA IRRRL if the VA itself doesn't require an appraisal?
VA mortgages are backed by the VA but the money used to fund the loan actually comes from the lender and not the VA. In case of default, the lenders are compensated by the VA but this is often not a dollar for dollar compensation and the lenders are still on the hook for some potential losses. This fear of loss causes many lenders to have their own guidelines on top of the base VA guidelines, these are known as underwriting overlays. Most but not all lenders require an appraisal and we do have access to the VA IRRL without an appraisal.
Can I refinance with the VA IRRRL if my current mortgage is not a VA loan?
No, the VA Streamline Refinance program can only be used to pay off a current VA mortgage. You can refinance a non-VA mortgage using your VA benefits with a full VA refinance. The full VA refinance would require income verification and a home appraisal.
What are the income requirements?
A verbal verification of employment will be completed
Is the any minimum Credit Score required?
640 credit scores and above are eligible
What if there was a late payment on the mortgage?
No late mortgage payments allowed in the last 12 months
What is the VA Funding Fee?
The VA Funding Fee is .50% of the loan amount for VA Streamline Refinances. As with the other VA programs, this is typically financed into the loan amount. There is no Funding Fee for Veterans with a service connected disability.