HR 3384119th CongressIn Committee

Refinancing Relief for Veterans Act

Introduced: May 14, 2025

Veterans Affairs

Standard Summary

Comprehensive overview in 1-2 paragraphs

The Refinancing Relief for Veterans Act would narrowly modify how the Department of Veterans Affairs charges a one-time loan fee for Interest Rate Reduction Refinancing Loans (IRRRLs) that the VA guarantees, insured, or otherwise makes. Specifically, it would strike the current IRRRL fee row in the VA loan fee table and replace it with a new, time‑based schedule. Under the bill, the VA would assess a closing fee that varies by when the loan is closed, with five distinct windows ranging from 2025 through 2035 and beyond. The stated aim is to provide “refinancing relief” for veterans by altering the cost of obtaining an IRRRL during these periods. The act is limited in scope to the fee schedule and does not change loan terms, interest rates, eligibility, or other VA loan program rules. The bill was introduced in the House on May 14, 2025 by Rep. Van Orden and referred to the Committee on Veterans’ Affairs. It is a targeted, time-bound adjustment to the VA loan program’s funding/guarantee fee structure for IRRRLs.

Key Points

1The bill amends 38 U.S.C. 3729(b)(2) to change the “loan fee table” for IRRRLs by striking the existing row related to interest rate reduction refinancing loans and inserting a new set of subparagraphs (E)(i)–(E)(v).
2New, time-based fee schedule for IRRRLs:
3- (E)(i): Closed Aug 1, 2025 to before Dec 31, 2025 — 0.50%
4- (E)(ii): Closed Dec 31, 2025 to before Dec 31, 2027 — 0.25%
5- (E)(iii): Closed Dec 31, 2027 to before Dec 31, 2032 — 0.50%
6- (E)(iv): Closed Dec 31, 2032 to before Dec 31, 2035 — 0.75%
7- (E)(v): Closed on/after Dec 31, 2035 — 0.50%
8The five periods specify the closing date window for loans and tie the fee percentage to when the loan is closed. All three columns shown in each row are identical in the text, indicating the same rate across those categories for each period.
9The act does not modify other VA loan program rules, eligibility requirements, or terms. It focuses solely on adjusting the IRRRL funding/insurance fee schedule.
10The bill is in the introductory stage; it would need to pass both houses and be enacted to become law.

Impact Areas

Primary group/area affected:- Veterans seeking to refinance an existing VA loan using an IRRRL, as the closing fee affects the upfront cost of refinancing and could influence the total cash outlay and monthly payments if financed into the loan.Secondary group/area affected:- VA-approved lenders and loan servicers, who would implement and collect the revised IRRRL funding fee at closing.Additional impacts:- Near-term refinancing activity: The 2025 window (0.50%) is higher than the 2025–2027 window (0.25%), creating a potential spike or drop in refinancing decisions depending on a veteran’s timing. The schedule later increases to 0.75% in 2032–2035 before returning to 0.50% thereafter, which could influence long-range planning for refinances.- Cost calculations for borrowers: Since the funding fee is typically financed into the loan balance or paid at closing, changes in the percentage directly affect the total cost of the loan and, indirectly, monthly payments and total interest over the life of the loan.- Administrative effect: The VA and lenders would need to implement the time-based fee schedule, track closing dates, and ensure correct application of the fee based on the loan close date.

Generated by gpt-5-nano on Oct 7, 2025