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Spousal Eligibility for VA Refinance

by JB
(Maryland)

My husband who was an Air Force veteran died over 25 years ago at age 38 and I never remarried. He was discharged by reason of physical disability established by the Medical Board.

However, he did not receive any compensation. I can't recall if he even applied.

We had used his eligibility for purchasing a home in 1980 and I paid off the loan in 2003. I am underwater in another home purchased by me in 2005. Originally it was financed by Wells Fargo and it is now with a federal credit union.

Is it possible for me to obtain a restored certificate of eligibility to qualify for the VA refinance program?

Say, hypothetically, my home is $100,000 less that its current value and I owe $300,000, how does the refinance program work?

Will the government finance the $300K or just the value of my home? All I want to do is lower this 6% interest rate and obtain a reasonable house payment since I've retired. Hope I've provided enough information.

=====ANSWERS=====

Hello JB from Maryland;

Thank you so much for stopping by my website and asking your questions. I will try to address them the best I can.

The fact that you have not remarried and your husband was a veteran, should make it possible for you to obtain a VA Home Loan.

Here's a quote from the VA website on that matter, "a surviving spouse who obtained a VA home loan with the veteran prior to his or her death (regardless of the cause of death), may obtain a VA guaranteed interest rate reduction refinance loan."

That's the good news.

Now as to the other issue, the bad news so to speak, they will only loan money on the actual value of the property. In fact the maximum LTV or loan to value is 90% I believe. It may vary from lender to lender.

So if your house is underwater, it may be impossible to get it refinanced to lower your rate and payment.

You may want to seek help with your local or state government for assistance if you are afraid of losing the house.

I wish I had better news for you. I do wish you the best.

Regards,

Jeff Ragan

Comments for Spousal Eligibility for VA Refinance

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Assistance in Maryland
by: Anonymous

Here is the Link to HOPE (Home Owners Preserving Equity) for assistance in MD: http://mdhope.dhcd.maryland.gov/Pages/Home.aspx

Here is the link for VA home financing information: http://www.benefits.va.gov/homeloans/

You may also want to discuss with your current lender and/or another lender to see what options they can assist you with. Here is a link to a wonderful lender who assisted with numerous VA loans and re-finance: http://www.fhmtg.com/spotter

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