VA Loan Eligibility Expands for Surviving Spouses

A soldier and his family sits on the front stoop. (Photo: U.S. Army)
A soldier and his family sits on the front stoop. (Photo: U.S. Army)

New law extends VA loan eligibility to more surviving spouses. Now a veteran’s death does not have to be duty-related for the widow to become eligible for VA home loan benefits.

An addition to the VA eligibility guidelines is good news for surviving military spouses. A new law, known as The Honoring America’s Veterans and Caring for Camp Lejeune Families Act (H.R. 1627), makes VA loans available to additional surviving spouses. Military widows can now be eligible if the veteran was rated totally disabled and eligible for compensation prior to death by any cause. The law designates that the veteran must have been eligible for compensation at the time of passing and be rated one of the following:

  1. Continuously totally disabled for at least 10 years immediately prior to death
  2. Continuously totally disabled for at least 5 years from the date of discharge
  3. Continuously totally disabled for at least 1 year prior to death of a POW who died after September 30, 1999

The change is significant because prior to the signing of the Act on August 6, 2012, only those whose spouses died of military-related causes were considered for home loan benefits.

Generally, VA home loan eligibility for surviving military spouses has been updated to include widows who have not remarried and:

  • Survived a spouse who died in service or from a service-related disability
  • Survived a spouse who was missing in action (MIA) or a prisoner of war (POW) for at least 90 days (limited to one-time use of benefit)
  • Survived a spouse who was rated continuously totally disabled for the specified period of time, and was eligible for disability compensation at the time of death by any cause

VA Home Loans for Surviving Spouses

Surviving spouses eligible for VA home loans may obtain government-backed mortgages of up to $417,000 (more in some areas). The advantages that accompany VA loans can make them an affordable option when purchasing or refinancing a home. Military widows can expect:

  • No VA funding fee
  • As little as zero down on purchase loans up to $417,000
  • Up to 100% refinancing of appraised value
  • No monthly mortgage insurance premiums
  • Low interest rates that are nationally competitive
  • No penalties for early payoff or balance reduction
  • VA Streamline refinancing even if ineligible for full VA loan benefits

Even if you may not have been eligible in the past, you may qualify now based on recent improvements to veterans’ benefits eligibility requirements. Click here to to reach a VA specialty lender and see if you qualify.

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