VA IRRRL Net Tangible Benefit & Savings Calculator
Use the tools below to estimate payment savings, recoupment timing, and high-level net tangible benefit checkpoints for a VA IRRRL. Then compare real lender quotes (same balance, term, and lock) to confirm the deal on an official Loan Estimate and Closing Disclosure.
Quick Answers
What Is a VA IRRRL?
- A streamlined refinance for borrowers with an existing VA-backed mortgage.
- Built to reduce the interest rate and/or improve payment stability (such as ARM to fixed).
- Usually simpler than a traditional refinance with fewer documentation hurdles.
- Not designed for meaningful cash-out or unrelated debt payoff.
Key Features (2026)
- Often minimal documentation; many cases do not require a new appraisal or full income verification.
- Structured to lower interest costs and can convert an adjustable-rate VA loan to a fixed-rate VA loan.
- Many borrowers can roll closing costs and the 0.5% VA funding fee into the loan balance.
- Occupancy flexibility: typically prior primary-residence occupancy is enough (not always current occupancy).
Core Eligibility Rules
- You must already have a VA-guaranteed home loan in place on the property.
- Seasoning is typically required: about 210 days since first payment due and six consecutive on-time payments.
- The refinance must show a net tangible benefit (rate reduction, stability, or similar qualifying benefit).
- Lenders can add overlays (credit score, payment history, documentation) beyond VA baseline rules.
Rates, Costs & Next Steps (Dec 2026)
- Late-2026 IRRRL rates have been seen around ~5.50% for 30-year terms, but offers vary and may include discount points.
- Funding fee is 0.5% (when not exempt); total closing costs often land around 3%–5% without lender credits.
- Use breakeven: total refinance costs ÷ monthly P&I savings = months to recoup fees.
- Shop lenders, then verify fees and break-even on the Loan Estimate and Closing Disclosure.
IRRRL Net Tangible Benefit & Savings Calculator
Enter your current VA loan details and a proposed IRRRL scenario. The tool estimates principal-and-interest payments, monthly savings, breakeven timing, and high-level VA checkpoint signals (rate thresholds where applicable and the recoupment / no-cost cost rules).
Use this estimate to set your target, then submit the short form to compare VA loan offers and validate the numbers on an official Loan Estimate.
Educational estimate only. Final eligibility and disclosures are set by your lender and VA requirements.
IRRRL Guide
Use this section to keep the deal “audit-clean”: align the benefit category, standardize lender quotes, and avoid fee structures that kill recoupment.
- Your P&I drops meaningfully and recoupment is within 36 months (when required).
- You expect to keep the home longer than the breakeven timeline.
- You avoid heavy points/fees that “buy” a rate but erase savings.
- You can document a valid benefit category (payment savings, stability, shorter term, or EEM).
- Same day quotes, same loan amount, same term, same lock period.
- Compare total lender fees + third-party costs (not just interest rate).
- Confirm savings is calculated on P&I (escrow changes are separate).
- Ask for the old vs. new comparison disclosure and read the total cost line.
IRRRL Eligibility Quick Checker
This yes/no checker covers core IRRRL requirements: existing VA loan, seasoning, payment history, cash-out intent, and prior occupancy certification.
Net Tangible Benefit & Recoupment Rules
VA IRRRLs must clearly benefit the borrower. Key checkpoints include rate thresholds where applicable and cost rules tied to whether P&I decreases.
| Scenario | Rate-change checkpoint | Cost rule checkpoint | Notes |
|---|---|---|---|
| Fixed → Fixed | New rate must be ≥0.50% lower than the old rate. | If P&I drops, allowable costs must recoup within 36 months (statutory test). | Compare apples-to-apples (points vs credits). Lender overlays apply. |
| Fixed → ARM / hybrid | Initial new rate must be ≥2.00% lower than the old fixed rate. | If P&I drops, allowable costs must recoup within 36 months (statutory test). | More scrutiny due to rate variability. LTV/point limits can apply. |
| ARM / hybrid → Fixed | No single numeric minimum like fixed→fixed/fixed→ARM. | If P&I drops, allowable costs must recoup within 36 months (statutory test). | Benefit is often stability. Some lenders still require meaningful improvement. |
| P&I does not decrease | NTB must be supported by another allowed benefit category. | Veteran generally must incur $0 allowable costs (excluding taxes/escrow and VA funding fee). | Usually requires lender credits to cover costs (“no-cost IRRRL”). |
The statutory 36-month recoupment calculation excludes the VA funding fee, escrow, and prepaid items. Your lender may show a broader figure that includes additional items.
IRRRL Funding Fee & Cost Estimator
For most non-exempt borrowers, the IRRRL funding fee is 0.50% of the base loan amount. This tool estimates it and shows the impact if financed vs paid in cash.
Tip: If you finance the fee, re-check your savings in the main calculator above (payment can change).
The statutory recoupment calculation excludes the VA funding fee, but your real-world savings can still be affected if you finance it into the balance.
Common IRRRL Issues & Denial Reasons
This matrix highlights frequent failure points under VA guidance and lender overlays so you can fix problems early.
| Issue | Typical impact | How to address |
|---|---|---|
| Fails fixed→fixed (0.50%) or fixed→ARM (2.00%) rate checkpoint | High – scenario likely fails NTB guidance. | Reprice (credits/points), confirm scenario classification, or wait for better rates. |
| Recoupment exceeds 36 months (when P&I drops) | High – costs likely cannot be incurred/financed under the statutory test. | Reduce fees, negotiate credits, or target a bigger rate improvement. |
| P&I does not decrease but borrower incurs costs | High – generally requires $0 allowable costs to the Veteran (excluding escrow/taxes and funding fee). | Structure as no-cost with lender credits or change terms to reduce P&I. |
| Insufficient seasoning (fewer than 6 payments or under 210 days) | High – IRRRL may not be eligible yet. | Verify first payment due date and count six consecutive payments; wait if needed. |
| Recent 30-day late payment | Medium to high – overlays and additional scrutiny likely. | Build clean history and document any one-time hardship if applicable. |
If a deal fails the applicable rate checkpoint or the recoupment/no-cost rule, most lenders will not proceed. Use the tools to surface that early—before you lock or pay for processing.
Process & Documents
IRRRLs are streamlined—but the file still needs to be consistent, traceable, and compliant. Use this checklist to avoid closing delays.
- Most recent mortgage statement + current interest rate and P&I.
- Payoff statement with per-diem interest and a good-through date.
- COE / VA loan details (lender can often pull, but you should know your loan number).
- Funding fee exemption proof if applicable (VA disability award documentation).
- Homeowner’s insurance + any second lien/HELOC information if subordination is needed.
- Run the calculator to set your target payment, savings, and recoupment.
- Collect at least three quotes with the same lock period and payoff date.
- Verify seasoning and benefit category; confirm whether the deal must be no-cost.
- Review the Loan Estimate for points/credits, lender fees, and financed costs.
- At Closing Disclosure, check for fee drift and confirm your first payment date.
Next Steps
120 words, conversion-focused, and aligned to the lead funnel.
Use the calculator to set your target savings and breakeven, then get real lender pricing. The fastest way to know whether an IRRRL is worth it is to compare offers on the same day with the same loan balance, term, and lock period. When you are ready, submit the short form on our Compare Loan Offers page. We will match you with VA experienced lenders who can provide a Loan Estimate and the required old versus new comparison so you can confirm net tangible benefit, recoupment, and total cash to close. If the numbers do not beat your break even timeline, walk away. Include lender credits, points, financed fees, and ask how the first payment date affects payoff interest today.
Frequently Asked Questions
Short, direct answers to the most common IRRRL questions.
What is the simple definition of a VA IRRRL?
How do I know if my IRRRL passes the net tangible benefit test?
Can I skip payments with an IRRRL?
Does my credit score matter on a VA IRRRL?
Will my escrow or total monthly payment always go down?
Can I roll closing costs and funding fee into the IRRRL?
References and Methodology
Primary VA publications used to design the calculators and summaries on this page.
- VA Circular 26-19-22: IRRRL net tangible benefit standards, fee recoupment, and seasoning rules. PDF
- VA Circular 26-19-22 Change 1: clarification of recoupment calculation details. PDF
- VA Loan Guaranty – Lender’s Handbook (VA Pamphlet 26-7), Chapter 6 (Refinancing Loans). Chapter 6 PDF Official VA Handbook index
- VA consumer IRRRL guidance. VA IRRRL information page
- VA consumer guidance on funding fee and closing costs (including exemptions). VA funding fee & closing costs page
- VA Form 26-8923 (IRRRL Worksheet) overview. About VA Form 26-8923
- VA sample lender documents (including old vs. new comparison examples). VA lenders sample documents
- VA Loan Network methodology standards. Methodology page
VA Loan Network. “VA IRRRL (Streamline Refinance) Net Tangible Benefit & Savings Calculator.” Last reviewed Dec 31, 2026. Available at: https://valoannetwork.com/va-loans/irrrl/
