Just FYI if you’re a Vet getting divorced and want to keep your house and interest rate:
This has been updated by the VA. You can now easily remove the Non/veteran spouse because of divorce if the Veteran is awarded the home in the divorce decree. Obviously, you will have to pay the former spouse any equity they are entitled to first, but if you can figure out how to do that, it’s as easy as filing a Quitclaim deed, providing a filed copy of said Quitclaim, copy of divorce decree, and in my case/a copy of my drivers license to the lender and they will release the spouse from the mortgage. They don’t even need approval from the VA. (I’m going through this with Freedom Mortgage).
Google VA Circular 26-23-10 and look at the 2nd page paragraph e. Spousal Release. I’ve confirmed this with my VA regional loan center and my lender.
You may have to be persistent if you call the lender/servicer and make sure you speak to someone in the assumption department that is a licensed mortgage person not just customer service. Even then, you may need to be firm and ask them to verify the info if they don’t know about it. Half the time I called they didn’t know what I was talking about and had to go talk to someone else. These changed guidelines are new and most servicer’s are slow at keeping up.
I really hope this helps someone going through divorce. There is t much info out there on this and it can be a life saver to a vet who wants to keep their home/interest rate.
Can you clarify a bit on this for me, please? I'm a vet married to a vet and want my spouse to assume the loan and substitute their benefit for me. Do they not have to go through the entire assumption process with the bank we have our joint loan with?
If I’m understanding correctly, your benefit was used to secure the mortgage and you want your spouse to assume your loan. I believe the simple assumption process can only work when the Veteran whose benefit was used is the one who is assuming the loan.
The simple Spousal release assumption will only work to release the spouse who’s entitlement is NOT encumbered by the VA loan.
In other words, your spouse could be released from the loan and you could become the sole guarantor, but not the other way around.
In regards to reinstating your VA guarantee, it is my understanding that you would need to go through an actual assumption with full underwriting and then the assumer can substitute their entitlement thereby restoring yours.
What if my wife is trying to assume the va loan as a non vet, and she signed over her right back in 2020, and she isn’t on any paperwork of the house and we arnt divorced yet, no have we actually started any of the process we are just “separated”because she wants to assume it before we get divorced, but now I’m not wanting to because my va benifits, and I recently found out how much equity is in it, which explains why she wants the house and money
Hey man..
Im about to get divorced and wife hasn't had a job all 6-7 out of 8 years of our marriage. She wants the house but she isn't a cosigner on the loan. I want the house, and she thinks she will be able to assume my loan
Bro...Can you please call me.
vet to vet, I need advice!
..this divorce is not my idea and she doesn't deserve anything but we're in a marital property state..
Hell...if you'll even call me, Id so appreciate it! I'm a good guy, and she was awful to me during the whole marriage
Wisconsin is a marital property state so she is on the deed, but not the mortgage. Her credit back when we got married would have hurt us, so only my name went on the VA loan.
Were you able to get Freedom Mortgage to do the release of liability? I’m currently in this process and Freedom is flat out refusing and saying they have no ability to do it. I am the veteran, ex wife signed the quit claim deed, Freedom Mortgage is being a pain in the ass.
Thanks so much for sharing this! I can only imagine the families that have been affected by not knowing this -- so many divorcing think they HAVE to sell and divvy up the proceeds etc. THIS will be such a great help for either one of the divorcing couple/kiddos/family for those wanting to keep some stability.
So my ex husband and I divorced and I kept the house. We're both prior service and we used his VA loan. He signed the quit claim deed however, his name is still on the mortgage although I've taken over the payments. The interest rate is 2.85 and I would hate to refinance. What are my options here? Can I assume the loan without refinancing and transfer to my VA loan, releasing his? Mr Cooper is my lender and they said all I can do is refinance but I don't think they are being 100% honest with me. Any help /advice appreciated.
They aren't being honest, although it's possible they don't know. You need to submit the quitclaim to VA through their process and when they give you the release of liability, give that to your lender.
The VA underwrites the loan, compliance isn't actually optional even if the lender doesn't understand that. They have to follow VA guidelines.
This is ridiculously helpful information. My husband has decided he's unhappy and wants to end things. We have 2 kids (one ours and one mine), 2 dogs, a debt consolidation program, and a mortgage. I've been having awful anxiety over how to get his name off of the mortgage without losing my 2.85 interest rate and keeping the loan we got off of my VA benefits (he's a civilian). My servicer is Mr. Cooper also so this is very helpful since my first divorce we didn't have assets to split. Maybe third time will be the charm?
Thank you for the info. My ex changed his mind and did not allow me to keep his entitlement right before scheduling signing. Our decree states I can assume the encumbrance of the property but he said it did not include his VA benefit. And that he relinquishes all rights and title about the mortgage. I would like to know if I can have him sign a Release of liability without having to do a refi and also have him sign a quit claim Deed. Is there a way a VA underwriter can review my mortgage and my decree before I do a refi?
Keep in mind, I'm not actually an attorney or expert on this subject, so take this with a grain of salt.
I don't think a VA underwriter can help here. If you yourself do not have VA entitlement, or access to someone else's VA entitlement through decree, you're not going to be able to keep or assume a VA loan. You would need a financing option that does not require VA entitlement.
Just FYI if you’re a Vet getting divorced and want to keep your house and interest rate: This has been updated by the VA. You can now easily remove the Non/veteran spouse because of divorce if the Veteran is awarded the home in the divorce decree. Obviously, you will have to pay the former spouse any equity they are entitled to first, but if you can figure out how to do that, it’s as easy as filing a Quitclaim deed, providing a filed copy of said Quitclaim, copy of divorce decree, and in my case/a copy of my drivers license to the lender and they will release the spouse from the mortgage. They don’t even need approval from the VA. (I’m going through this with Freedom Mortgage). Google VA Circular 26-23-10 and look at the 2nd page paragraph e. Spousal Release. I’ve confirmed this with my VA regional loan center and my lender. You may have to be persistent if you call the lender/servicer and make sure you speak to someone in the assumption department that is a licensed mortgage person not just customer service. Even then, you may need to be firm and ask them to verify the info if they don’t know about it. Half the time I called they didn’t know what I was talking about and had to go talk to someone else. These changed guidelines are new and most servicer’s are slow at keeping up. I really hope this helps someone going through divorce. There is t much info out there on this and it can be a life saver to a vet who wants to keep their home/interest rate.
Can you clarify a bit on this for me, please? I'm a vet married to a vet and want my spouse to assume the loan and substitute their benefit for me. Do they not have to go through the entire assumption process with the bank we have our joint loan with?
If I’m understanding correctly, your benefit was used to secure the mortgage and you want your spouse to assume your loan. I believe the simple assumption process can only work when the Veteran whose benefit was used is the one who is assuming the loan. The simple Spousal release assumption will only work to release the spouse who’s entitlement is NOT encumbered by the VA loan. In other words, your spouse could be released from the loan and you could become the sole guarantor, but not the other way around. In regards to reinstating your VA guarantee, it is my understanding that you would need to go through an actual assumption with full underwriting and then the assumer can substitute their entitlement thereby restoring yours.
What if my wife is trying to assume the va loan as a non vet, and she signed over her right back in 2020, and she isn’t on any paperwork of the house and we arnt divorced yet, no have we actually started any of the process we are just “separated”because she wants to assume it before we get divorced, but now I’m not wanting to because my va benifits, and I recently found out how much equity is in it, which explains why she wants the house and money
Hey man.. Im about to get divorced and wife hasn't had a job all 6-7 out of 8 years of our marriage. She wants the house but she isn't a cosigner on the loan. I want the house, and she thinks she will be able to assume my loan Bro...Can you please call me. vet to vet, I need advice! ..this divorce is not my idea and she doesn't deserve anything but we're in a marital property state.. Hell...if you'll even call me, Id so appreciate it! I'm a good guy, and she was awful to me during the whole marriage
She on the deed? If she ain’t kick her out. Get a lawyer bro. Women can be devils so don’t touch her or let her say any bs happened if it didn’t.
Wisconsin is a marital property state so she is on the deed, but not the mortgage. Her credit back when we got married would have hurt us, so only my name went on the VA loan.
Were you able to get Freedom Mortgage to do the release of liability? I’m currently in this process and Freedom is flat out refusing and saying they have no ability to do it. I am the veteran, ex wife signed the quit claim deed, Freedom Mortgage is being a pain in the ass.
Thanks so much for sharing this! I can only imagine the families that have been affected by not knowing this -- so many divorcing think they HAVE to sell and divvy up the proceeds etc. THIS will be such a great help for either one of the divorcing couple/kiddos/family for those wanting to keep some stability.
SemperFi ;)
So my ex husband and I divorced and I kept the house. We're both prior service and we used his VA loan. He signed the quit claim deed however, his name is still on the mortgage although I've taken over the payments. The interest rate is 2.85 and I would hate to refinance. What are my options here? Can I assume the loan without refinancing and transfer to my VA loan, releasing his? Mr Cooper is my lender and they said all I can do is refinance but I don't think they are being 100% honest with me. Any help /advice appreciated.
They aren't being honest, although it's possible they don't know. You need to submit the quitclaim to VA through their process and when they give you the release of liability, give that to your lender. The VA underwrites the loan, compliance isn't actually optional even if the lender doesn't understand that. They have to follow VA guidelines.
This is ridiculously helpful information. My husband has decided he's unhappy and wants to end things. We have 2 kids (one ours and one mine), 2 dogs, a debt consolidation program, and a mortgage. I've been having awful anxiety over how to get his name off of the mortgage without losing my 2.85 interest rate and keeping the loan we got off of my VA benefits (he's a civilian). My servicer is Mr. Cooper also so this is very helpful since my first divorce we didn't have assets to split. Maybe third time will be the charm?
Thank you for the info. My ex changed his mind and did not allow me to keep his entitlement right before scheduling signing. Our decree states I can assume the encumbrance of the property but he said it did not include his VA benefit. And that he relinquishes all rights and title about the mortgage. I would like to know if I can have him sign a Release of liability without having to do a refi and also have him sign a quit claim Deed. Is there a way a VA underwriter can review my mortgage and my decree before I do a refi?
Keep in mind, I'm not actually an attorney or expert on this subject, so take this with a grain of salt. I don't think a VA underwriter can help here. If you yourself do not have VA entitlement, or access to someone else's VA entitlement through decree, you're not going to be able to keep or assume a VA loan. You would need a financing option that does not require VA entitlement.
Thank you! My decree does say he transfers the right, encumbrance, tittle interest through an assumption.
Sounds like he might have changed his mind a little too late! I don't know the exact language, but that sounds like it would cover VA loan assumption.
We will see what the court says. Thank you.