VA Refinance Guidelines: What You Should Know

4 Min Read
Updated March 8, 2024
Young man in chambray shirt at kitchen table looking up VA loan refinancing on laptop with smile on face.
Written By Scott Steinberg

A VA refinance can prove a handy way to help you lower your interest rate and save money on your monthly mortgage payments. If you’re looking to refinance your VA loan, there are some important VA refinance guidelines and eligibility requirements that you should be aware of, however.

Let’s take a closer look at how a VA loan refinance can put more money back in your pocket − and what you need to know about VA refinance guidelines and requirements before applying to receive one.

Refinancing With VA Loans

A Department of Veterans Affairs (VA) loan refinance can help eligible active-duty servicemembers, veterans and surviving spouses save money over the life of their loan. At the same time, it’s necessary to follow VA refinance guidelines to qualify to refinance your mortgage.

Note that you will have to account for the VA funding fee as part of the refinancing process as well. Under the terms of a VA loan refinance, you could  receive a lower interest rate on your home mortgage, and secure cash back that you can put towards home improvements or other debts that you’d like to pay off.

If you’re thinking of pursuing a VA refinance, be aware that there are two different ways to refinance a VA home loan: streamline and cash-out refinances − see below for more.

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VA Loan Refinance Guidelines To Be Aware Of 

Of course, refinancing a VA loan also comes with guidelines attached for homeowners that borrowers need to be aware of before they start the process. Read on to learn these guidelines.

Activity Duty Status

Service members can qualify for a VA refinance if they have served on active duty for more than 90 consecutive days during wartime or more than 181 days of service during peacetime. Veterans, on the other hand, must have been in the service for a minimum of 6 years. In addition, spouses of veterans who passed in the line of duty are eligible for a VA refinance.

Credit Score

While the VA itself doesn’t have a minimum credit score requirement, individual mortgage lenders typically will have their own requirements that homeowners must meet.

Most lenders require that applicants maintain a credit score of at least 620 in order to proceed with a VA refinance. However, specific terms and requirements  will vary by financial provider.


Lenders will typically consider the debt-to-income ratio (DTI) of VA refinance applicants as well as residual income. The VA will require the borrower to have a certain amount leftover each month. In general, the higher your income, and the less of it that’s going to pay off debt each month, the likelier to meet eligibility requirements and VA refinance guidelines that you’ll be.

Other Guidelines

A Certificate of Eligibility (COE) will also be required of those looking to get approved for a VA refinance. In addition, private lenders may also apply other guidelines that borrowers will need to meet in order to continue with the refinancing process. As always, it pays to keep extensive documentation about your income, investments, expenses, employment and credit history handy in case they’re needed.

Types Of VA Refinance Loans 

Two types of VA refinance loans are available to homeowners to move to more favorable interest rates and loan terms. Let’s take a closer look at the options available.

VA Streamline Refinance (IRRRL)

A VA Streamline refinance offers a handy way for homeowners to refinance an existing VA loan to a new loan product. In effect, this VA refinancing option provides a lower interest rate or converts the loan to a more favorite fixed-rate model.

If you’re looking to finance closing costs over time, you can also add them into the overall loan amount. As the name indicates, the word “streamline” is typically used to describe this form of VA loan refinance due to the speedy nature of this refinancing type.

VA Cash-Out Refinance Loans

A cash-out refinance provides a helpful way for veterans to refinance their VA loan while taking out cash from equity that they’ve built up in their homes. This type of refinance loan will replace your existing mortgage. Veterans can also use this form of VA refinancing to obtain a lower interest rate as well.

The Bottom Line

A VA loan refinancing can help you secure a better interest rate, lower monthly fees and more favorite home mortgage terms. To receive one, you’ll need to meet certain minimum eligibility requirements.

Interested in learning more about VA loans? Browse our Learning Center, which offers all sorts of helpful advice and tips on how to manage a home mortgage refinance and secure the best loan terms and interest rates today.

View Your Refinancing Options

See recommended refinance options and customize them to fit your budget.