Mortgage Servicing and Loan Modifications: 9.2.2.9 Refinancing
A borrower may refinance a high-interest-rate loan at a current, lower rate with the VA’s interest rate reduction refinancing loan.74 The new loan could also be used to obtain a shorter term or a fixed interest rate or to fund energy efficiency improvements. However, the term of the refinance loan may not exceed the term of the original loan plus ten years, or thirty years altogether, whichever is shorter. If the current loan is delinquent or if foreclosure is imminent, VA approval is necessary to refinance.