Refinancing a VA Loan in a Divorce Situation

VA Streamline Refinances (IRRRL – Interest Rate Reduction Refinance Loan) after a death, divorce or marriage.

The general rule of thumb is that the eligible Veteran must remain on the loan. It’s the entitlement of the Veteran that makes the VA loan possible.

1. Can the divorced Veteran remove a former spouse with an IRRRL? Yes.

2. Can a divorced and re-married Veteran remove the former spouse and add the new spouse with an IRRRL? Yes.

3. Can an eligible Veteran refinance the mortgage into their own name with an IRRRL, substituting their entitlement, even though another Veteran originally purchased the home (When both divorcing spouses are veterans with a VA entitlement)? Yes.

4. Can a Veteran remove a non-spouse with whom he or she originally purchased the house using an IRRRL? Yes.

5. Can a divorced spouse of the eligible Veteran use an IRRRL to refinance? No.

When the divorce settlement involves real estate and VA mortgage financing, the Certified Divorce Lending Professional on your team plays a significant role in putting the pieces of the puzzle together by recognizing the hurdles and opportunities available for both parties.

This is for informational purposes only and not for the purpose of providing legal or tax advice. You should contact an attorney or tax professional to obtain legal and tax advice. Interest rates and fees are estimates provided for informational purposes only, and are subject to market changes. This is not a commitment to lend. Rates change daily – call for current quotations.

Always work with a Certified Divorce Lending Professional (CDLP) when going through a divorce and real estate or mortgage financing is present.

Copyright 2019 Divorce Lending Association. No portion of this post may be reproduced without the written consent of the Divorce Lending Association.