For military service members, VA loans can eliminate many of the barriers standing between you and your ability to buy a home. In most cases, active duty and retired service members can enjoy zero down payments, reduced interest rates, affordable mortgage insurance, and minimal closing costs, thanks to the Department of Veteran Affairs.
But of course, VA loans still come with their own set of eligibility requirements. Especially if you’re the spouse of a veteran or a military member looking to add your significant other to the purchase loan.
That’s why we’re to answer the most commonly asked questions about VA loan spouse requirements, so that you and your family can get the most out of your next home purchase.
Does My Spouse Have To Be On My VA Loan?
In short: No.
While VA loan requirements will still need to be met by the service member applying for the mortgage, it’s not necessary to include your spouse on your loan if you choose not to. However, you should be aware of some key benefits to having your spouse on your VA loan before making your final decision.
For instance, having a spouse on your loan may help you meet some of the strict eligibility requirements that VA loan recipients have to adhere to. By including your spouse’s income when you apply for a VA loan, you may be able to qualify for more house than you would if you were applying on your own.
This can improve your chances of finding a home that you really love, while still reaping the benefits that VA loans provide.
Will Their Credit Score Impact My Loan Application?
Now, this is where adding the spouse of a veteran to a VA loan can be tricky.
Just like with a traditional mortgage loan, the credit scores of both co-borrowers or co-signers are heavily factored into the approval process. This means that you’ll need to carefully evaluate whether your spouse’s credit will improve or hinder your ability to get a good rate on your loan.
If your spouse has good credit, they can drive down your interest rate and secure a sizable loan amount that will come in handy when it’s time to buy a home.
But if your spouse’s credit is in bad shape, it can greatly reduce your chances of getting the full loan amount that you’re looking for, regardless of what your own credit looks like.
This is one of the factors you’ll need to consider when deciding whether or not to add your spouse as a co-borrow on any VA loans.
Can A Non-Spouse Be Added To VA Loans?
Sure, it may be easy to add a spouse to your mortgage loan. But what about non-married partners or another person who plans on sharing your home with you?
Well, thanks to flexible loan requirements implemented by the Department of Veteran Affairs, you can officially add a non-spouse to your VA loan using the same process.
However, the same considerations apply to all co-borrowers, no matter what your relationship to them is. Be sure to take a careful look at the credit scores and income information of anyone you’re thinking of adding to your mortgage.
What Happens If VA Loan Co-Borrowers Get Divorced?
Let’s face it, divorce makes everything more complicated. And the same can be said for anyone relying on VA loans for their home mortgage.
So, if you and your spouse decide to separate after taking out a VA loan together, there are a few different scenarios that could take place.
Ex-Spouses Of Military Members
When a civilian spouse and a military service member get divorced, but they haven’t applied for a VA loan together, then the spouse in this scenario would lose their ability to take out any new VA loans. That’s because VA benefits only apply to spouses who are currently married or have been widowed by an active duty or retired service member.
Co-Signers On VA Loans
However, if you and your spouse get divorced and they’re already a co-signer on your VA loan, then they’ll be able to continue occupying the home, even if the service member no longer lives there. This will likely be determined during the divorce settlement process.
Entitlements For Military Members
Finally, if the civilian spouse has decided to keep the home and the mortgage after the divorce, this may prevent the service member from being able to claim any new entitlements. In this case, your ex-spouse will need to either refinance or completely pay off the existing VA loan before any new benefits can be claimed.
Can Surviving Spouses Take Out VA Loans?
Losing a spouse is a devastating event, especially when it involves a service member who has been killed in the line of duty. Thankfully, VA loans have protections in place that can help alleviate the financial strain for surviving spouses who have lost their other half.
First, the spouse will need to receive a Certificate of Eligibility (COE) through the Department of Veteran Affairs. To meet the eligibility requirements for this, one of the following circumstances must apply…
- The service member has been deemed missing in action or MIA for at least 90 days
- The service member has been classified as a Prisoner of War (POW)
- The veteran died in the line of duty and the spouse did not remarry
- The veteran died from a service-related disability and the spouse did not remarry
- The veteran became totally disabled and later passed away
If any of these events have taken place, then the spouse of a veteran can qualify for support from VA loan programs.
Ready To Apply For A VA Loan?
We understand that navigating the VA loan spouse requirements can be complicated.
That’s why our team of VA home loan specialists is here to help you and your spouse decide if co-borrowing on a home loan is the right choice for you, based on your unique home-buying needs.
Take the first step in the loan application process by calling (602)-908-5849 today.