Sara Routhier, Managing Editor and Outreach Director, has professional experience as an educator, SEO specialist, and content marketer. She has over five years of experience in the insurance industry. As a researcher, data nerd, writer, and editor she strives to curate educational, enlightening articles that provide you with the must-know facts and best-kept secrets within the overwhelming world o...

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Joel Ohman is the CEO of a private equity-backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He also has an MBA from the University of South Florida. ...

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Reviewed by Joel Ohman
Founder, CFP®

UPDATED: Oct 24, 2012

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VA loans are given to eligible applicants who are military members. If a divorce occurs, the non-military member loses all VA loan rights.

VA loans offer future homeowners options that regular mortgages do not. VA home loans do not have private mortgage insurance requirements and usually come with lower rates than conventional loans. Finally, VA loans offer lower-rate refinance options without having to re-qualify for the loan.

Spouses of qualified military personnel are able to reap these benefits during the home loan process because of association. The benefits only exist because the non-military spouse is married to the military spouse. If the non-military spouse is divorced, the VA benefits are lost, unless they decide to join the military. Even single military personnel can be rejected from a VA home loan due to the rigid application requirements.

But not all non-military spouses are stripped of their VA benefits. The rules for VA loans, in the case of deceased veterans, vary. Surviving spouses of now-deceased military members have more authority than divorced partners. If a military member died on active duty or as a result of a service-related issue, the non-military spouse would be able to refinance an existing home loan into a VA loan, or apply for a new VA loan.

If divorce is unavoidable for a couple, there are several options to consider. The first step to take is to decide which partner gets the house and whether or not he or she can afford the mortgage. If the payments are too high for the chosen individual, he or she can opt to refinance the home with a longer mortgage term or a lower interest rate. If neither partner can afford the home — even with a refinance — there’s always the option of selling the property and dividing any equity.

Dealing with both an emotionally-charged divorce and potentially losing a home can be difficult, but with the right information, it can be solved as smoothly as possible.