VA Loan Eligibility After A Divorce For Boise Idaho Home Owners
There are many ways in which a getting a divorce can have an impact on Boise Idaho VA loans.
Let’s go ahead and start off with the basics.
First, let’s look at a scenario where the Boise Idaho VA loan is only filed under the veteran’s name.
The VA loan guaranty is only available due to the veteran’s eligibility for the loan.
After the VA loan is processed, the guaranty will remain with the mortgage even if the borrowing veteran or member of the armed forces stops living there. The only way the VA loan guaranty will be removed is if the loan is refinanced by the former spouse into a conventional mortgage, which will then make the military borrower again eligible for a new VA mortgage.
Jointly held mortgages are a little different from the above process.
The name of each spouse is on the mortgage, and if they both work the couple may qualify for a higher loan amount with their combined income than either would individually.
Only one spouse needs to be a veteran or military service member and eligible in order to get qualified for a Boise Idaho VA loan. After the VA guaranty is committed to a mortgage, it is no longer attached only to the veteran borrower.
This is what makes joint mortgages a little tricky when it comes to divorce, especially since few ex-spouses will want to maintain a joint mortgage together. With this in mind, there are a few potential situations that can arise:
- The ex-spouses can sell their property and divide the equity or debt.
- They can designate sole-ownership of the property to one person and then refinance the mortgage into the name of just one borrower.
- If neither ex-spouse can qualify for a loan on their own, the original mortgage will remain until the property is sold. In this case, the veteran will not be eligible for another VA loan as long as the original mortgage remains.
After the mortgage is terminated, the veteran can apply for a new loan guaranty. Normally, there will not be any change from the original eligibility.
It is critically important that after the divorce a complete copy of the divorce decree and any payments to the ex-spouse are documented.
If you have a VA loan and you’d like to get a VA IRRRL loan (also known as a VA Streamline Refinance), there are also some things you should keep in mind if you are going to get divorced, married, or re-married.
During your regular VA loan application process, each of the borrowers whose names appeared on the loan was reviewed by the VA. Since VA IRRRL loans do not require a credit check, you are required to keep each borrower from the original loan on your VA Streamline Refinance.
Unfortunately, there is no way to remove a borrower for a Idaho VA Streamline Refinance.
In order to get a new VA loan during or after getting a divorce, you will be required to follow the steps of your first VA loan.
However, if you are getting married, already have a VA loan and decide to get a VA Streamline Refinance, you are allowed to add your new partner to the loan.
Frequently Asked Questions:
Q: What is a VA Guaranteed Home Loan?
A: VA guaranteed home loans are loans made to eligible veterans for the purchase of a home as their primary residence. The guaranty means the lender is protected against loss if you fail to repay the loan. The guaranty replaces the protection the lender normally receives by requiring a down payment allowing you to obtain favorable financing terms.
Q: Does my entitlement guarantee that I will get a home loan?
A: No VA cannot compel a lender to make a loan that would violate their lender policies.
Q: How much is my entitlement?
A: Your basic entitlement is $36,000. For loans in excess of $144,000 to purchase or construct a home, additional entitlement up to an amount equal to 25 percent of the Idaho VA county loan limit for a single family home may be available . This means that qualified veterans could get a no down payment purchase loan for those amounts.
Q: How do I apply for a VA guaranteed loan?
A: You can apply for a VA loan with my company who is a mortgage lender that participates in the VA home loan program. At some point you will need to get a Certificate of Eligibility from VA to prove to the lender that you are eligible for a VA loan.
Q: How do I get a Certificate of Eligibility?
A: Complete a VA Form 26-1880, Request for a Certificate of Eligibility. You can apply for a Certificate of Eligibility by submitting a completed VA Form 26-1880, Request for a Certificate of Eligibility for Home Loan Benefits, to the Winston-Salem Eligibility Center, along with proof of military service.
Q: Can my lender get my Certificate of Eligibility for me?
A: Yes, it’s called Web LGY. Most lenders have access to the Web LGY system. This internet based application can establish eligibility and issue an online Certificate of Eligibility in a matter of seconds. Not all cases can be processed through Web LGY – only those for which VA has sufficient data in our records.
Q: What is acceptable proof of military service?
A: If you are still serving on regular active duty, you must include an original statement of service signed by, or by direction of, the adjutant, personnel officer, or commander of your unit or higher headquarters which identifies you and your social security number, and provides your date of entry on your current active duty period and the duration of any time lost.
If you were discharged from regular active duuty after January 1, 1950 a copy of DD Form 214, Certificate of Release or Discharge From Active Dutyshould be included with your VA Form 26-1880. If you were discharged after October 1, 1979, DD Form 214 copy 4 should be included.
If you are still serving on regular active duty, you must include an original statement of service signed by, or by direction of, the adjutant, personnel officer, or commander of your unit or higher headquarters which shows your date of entry on your current active duty period and the duration of any time lost.
If you were discharged from the Selected Reserves or the National Guard, you must include copies of adequate documentation of at least 6 years of honorable service. If you were discharged from the Army or Air Force national Guard, you may sumit NGB Form 22, Report of Separation and Record of Service, or Reserve, you may submit a copy of your latest annual points statement and evidence of honorable service. Unfortunately, there is no single form used bythe Reserves or National Guard similar to the DD Form 214. It is your responsibility to furnish adequate documentation of at least 6 years of honorable service.
If you are still serving in the Selected Reserves or the National Guard, you must include an original statement of service signed by, or by the direction of, the adjutant, personnel officer, or commander of your unit or higher headquarters showing length of time that you have been a member of the Selected Reserves. Again, at least 6 years of honorable service must be documented.
Q: How can I obtain proof of military service?
A: Standard Form 180, Request Pertaining to Military Records, is usd to apply for proof of military service regardless of whether you served on regular active duty or in the selected reserves. This request form is not processed by VA. Rather, Standard Form 180 is completed and mailed to the appropriate custodian of military service records. Instructions are provided on the reverse of the form to assist in determining the correct forwarding address.
Q: I have already obtained one VA loan. Can I get another one?
A: Yes, your eligibility is reusable depending on the circumstances. Normally, if you have paid off your prior VA loan and disposed of the property you can have your used eligibility restored for additional use. Also, on a one-time only basis, you my hae your eligibility restored if your prior VA loan has been paid in full but you still own the property.
Q: Is the surviving spouse of a deceased veteran eligible for the home loan benefit?
A: The unmarried surviving spouse of a veteran who died on active duty or as the result of a service-connected disability is eligible for the home loan benefit. In addition, a surviving spouse who obtained a VA home loan with the veteran prior to his or her death (regardless of the cause of the death), may obtain a VA guaranteed interest rate reduction refinance loan.
If you have any questions about a VA home loan feel free to contact me.
Michelle Guth
Diversified Mortgage Group
Branch Manager/Owner
Direct: 208-475-0865
Loanswithmichelle@gmail.com
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