Get Expert Financing
- Matched with investor-friendly lenders
- Fast pre-approvals-no W2s required
- Financing options fro rentals, BRRRR, STRs
- Scale your portfolio with confidence
Homeowners looking to lower their mortgage payments or interest rates often turn to streamline refinancing. Among the most popular are FHA Streamline Refinance and VA IRRRL (Interest Rate Reduction Refinance Loan). While both offer simplified processes, they serve different borrower groups and come with distinct features.
In this guide, we’ll compare FHA and VA streamline refinance options, break down eligibility, benefits, and drawbacks, and help you decide which fits your needs best.
What Is Streamline Refinancing?
Streamline refinancing is a simplified process for homeowners to refinance their existing government-backed mortgages. It generally:
- Requires less paperwork
- Often waives the home appraisal
- Offers faster approval and closing
It’s important to note that streamline programs are only available for borrowers who already have FHA or VA loans.
FHA Streamline Refinance Overview
The FHA Streamline Refinance is designed for homeowners with existing FHA loans who want to lower their monthly payments or move from an adjustable-rate mortgage to a fixed-rate loan.
Key Features:
- No appraisal required
- No income verification (in many cases)
- Must demonstrate a net tangible benefit (e.g., lower payment or better terms)
- Mortgage must be current (no late payments in the past 12 months)
Costs:
- Upfront Mortgage Insurance Premium (UFMIP): Typically 1.75% of the loan
- Annual Mortgage Insurance Premium (MIP): Required for the life of the loan (in most cases)
VA IRRRL (VA Streamline Refinance) Overview
The VA IRRRL, often called a VA streamline refinance, is available to eligible veterans, active-duty service members, and surviving spouses with existing VA loans.
Key Features:
- No appraisal required
- No income verification
- Must have a prior VA loan
- The new loan must result in a lower interest rate (unless refinancing from an ARM to a fixed-rate)
Costs:
- Funding Fee: Generally 0.5% of the loan (can be waived for disabled veterans)
- No private mortgage insurance (PMI)
Extra Benefits:
- You can roll closing costs into the loan
- Easier for veterans who’ve recently moved or changed duty stations
FHA vs VA Streamline Refinance: Side-by-Side Comparison
| Feature | FHA Streamline | VA IRRRL |
| Eligibility | Existing FHA loan | Existing VA loan |
| Appraisal Required? | No | No |
| Income Verification? | Often not required | Not required |
| Upfront Fees | 1.75% UFMIP | 0.5% Funding Fee |
| Ongoing Mortgage Insurance | Yes (MIP for life in many cases) | None |
| Net Tangible Benefit Required? | Yes | Yes |
| Loan Use Flexibility | Limited to FHA-to-FHA | VA-to-VA only |
Which Is Right for You?
- Choose FHA Streamline Refinance if:
- You currently have an FHA loan
- You’re okay with continuing to pay MIP
- You want a faster, less paperwork-heavy refinance
- You currently have an FHA loan
- Choose VA IRRRL if:
- You currently have a VA loan
- You’re a qualifying veteran or spouse
- You want to avoid monthly mortgage insurance
- You currently have a VA loan
Frequently Asked Questions (FAQ)
Can I switch from an FHA loan to a VA loan?
No. FHA and VA streamline refinance programs require you to refinance within the same loan type. However, you may qualify for a standard VA refinance if you’re eligible.
Do I need perfect credit to qualify for a streamline refinance?
No. While credit is considered, both FHA and VA streamline programs are lenient. VA IRRRLs in particular do not require a credit check in many cases.
Can I get cash back through a streamline refinance?
Generally, no. Streamline refinancing is intended for rate and term adjustments only, not cash-out. For that, you’ll need to explore FHA or VA cash-out refinance options.
Read Next
If you found this article helpful, here are more resources to explore:
By understanding the differences between FHA and VA streamline refinances, you’ll be better prepared to make a confident and informed decision for your financial future.
Ready to take the next step? Talk to a mortgage advisor now and explore your refinance opportunities.
Get Expert Financing
- Matched with investor-friendly lenders
- Fast pre-approvals-no W2s required
- Financing options fro rentals, BRRRR, STRs
- Scale your portfolio with confidence
Our advice is based on experience in the mortgage industry and we are dedicated to helping you achieve your goal of owning a home. We may receive compensation from partner banks when you view mortgage rates listed on our website.
