VA Loan Options for Military Couples

Those who serve in the Army, Navy, Air Force, or Marines are quite familiar with the phrase "mil-to-mil spouses" or "mil-to-mil couple."

For the uninitiated, the phrase, "mil-to-mil" refers to a married couple who are both members of the armed forces. For married couples looking for a VA home loan, when both are in the military, there are a variety of options when it comes to using VA insured loan benefits.

A common choice is for one spouse all of his or her VA loan entitlement for the mortgage, allowing the other spouse to reserve entitlement for later use. A non-applicant spouse would only be financially obligated on the VA loan if he or she co-signed or co-borrowed on the mortgage--or in cases where the loan originates in a community property state.

Another option--one spouse could use his or her remaining VA loan entitlement (any left over from a previous VA home loan) with the other spouse providing the majority of the VA loan entitlement. This would apply in situations where one partner in a mil-to-mil couple previously owned a home purchased with a VA mortgage and no longer has 100% entitlement but does have some VA loan entitlement left over to use for the new mortgage.

A third choice where the mil-to-mil couple splits their entitlement evenly for a joint VA home loan. In this case, both spouses carry financial obligation for their half of the mortgage. The loan agreement would feature equal amounts of VA loan entitlement from each party named on the mortgage.

Occupancy rules are straightforward for mil-to-mil couples. In all the situations mentioned here, the VA Lender’s Guide says, “Any person who uses entitlement on a joint loan must certify intent to personally occupy the property as his or her home. Any borrower on a joint loan who does not use entitlement for the loan (such as a nonveteran), does not have to intend to occupy the property.”

That means two married veterans using their VA loan entitlements separately could not purchase two homes at once with VA loans for the purpose of using one as an investment property or summer home--the borrower must intend to occupy the home purchased with a VA mortgage.