VA Refinance Calculator

The Interest Rate Reduction Refinance Loan — commonly called the IRRRL or “streamline refinance” — is a VA refinance program for existing VA loan borrowers. It allows you to refinance to a lower interest rate with significantly less paperwork than a standard refinance.

• Only available for existing VA loans — cannot convert a conventional or FHA loan to a VA loan
• Typically no appraisal required
• No income verification or debt-to-income calculation in most cases
• Must result in a lower interest rate, lower payment, or transition from an adjustable-rate to a fixed-rate mortgage
• VA funding fee is 0.5% (much lower than the purchase fee)
• Disability-rated veterans are exempt from the IRRRL funding fee as well

Full 2026 funding fee rates — purchase, IRRRL, and cash-out →

A VA Cash-Out Refinance replaces your current mortgage — VA or non-VA — with a new VA loan. Unlike the IRRRL, it can be used to convert a conventional or FHA loan into a VA loan, and it can pull equity out as cash.

• Requires full underwriting — appraisal, income verification, credit check
• Can be used to refinance a conventional loan into a VA loan (the IRRRL cannot)
• Can access home equity as cash
• Funding fee is higher: 2.15% first use, 3.30% subsequent use (same as purchase loans)
• Disability-rated veterans are exempt from the cash-out funding fee as well

The VA requires that an IRRRL provide a “net tangible benefit” to the borrower. For a fixed-to-fixed rate refinance, the new interest rate must be at least 0.5% lower than the current rate. Converting from an adjustable-rate to a fixed-rate mortgage is considered a benefit in itself — rate reduction is not required in that case.

VA lenders are required to document the net tangible benefit before closing. An IRRRL that fails the 0.5% threshold for a fixed-to-fixed scenario may still be lender-approved if the lender can otherwise document the benefit — but it is a yellow flag worth discussing with your lender.

The 36-month recoupment guideline means your closing costs should be recouped within 36 months through monthly savings. VA's calculation excludes the funding fee and escrow — so a refinance can pass the VA recoupment test even when the all-in consumer break-even (including the funded fee) exceeds 36 months. This calculator shows both numbers separately.

This calculator estimates fixed-rate refinance scenarios. For ARM-to-fixed conversions, the stability of a fixed rate is generally considered a net tangible benefit by VA, even if the initial payment does not decrease. Consult with your lender for ARM-specific IRRRL guidance.

• You plan to sell within the break-even period — you won't recoup the closing costs before the sale
• The rate reduction is too small to justify the fees — especially for a subsequent-use cash-out at 3.30%
• You're restarting a long term — refinancing a 20-year-remaining loan to a new 30-year adds 10 years of payments; even with a lower rate, the extended amortization usually means paying more in interest overall
• You've paid down substantial principal — restarting the amortization clock means more of your early payments go to interest again