VA Home Loan Programs for Surviving Spouses

Updated: April 26, 2022

Table of Contents


    Surviving spouses have access to the VA Home Loan Program, formally known as the Department of Veterans Affairs Home Loan Program. In this article, we’ll discuss how surviving spouses can access this outstanding benefit.

    VA Home Loan Programs for Surviving Spouses Specifically, we’ll cover the following VA Home Loan considerations with respect to surviving spouses:

    • VA Home Loan overview
    • How does the VA define “spouse”?
    • VA Home Loan surviving spouse eligibility requirements
    • Using the VA Home Loan as a surviving spouse
    • Additional surviving spouse VA Home Loan benefits
    • Final thoughts

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    VA Home Loan Overview

    Available to military members, veterans, and – as we’ll see below – surviving spouses, the VA Home Loan is a mortgage product guaranteed by the Department of Veterans Affairs that provides these three outstanding benefits:

    • No down payment: Most conventional home loans require borrowers to place a 20% downpayment, which can be cost-prohibitive for many first-time home buyers. With the VA Home Loan, borrowers don’t need to put any money down!
    • Low interest rate: Due to the fact that a portion of the VA Home Loan is guaranteed by the federal government, lenders face less risk with these loans. Borrowers receive the benefits of this lower risk in the form of lower interest rates, which can save tens to hundreds of thousands of dollars over the life of a loan.
    • No PMI: Private mortgage insurance, or PMI, is an additional insurance product lenders typically require of borrowers with less than a 20% down payment. For borrowers, this can mean over $1,000/year of payments on top of your regular mortgage payments. With the VA Home Loan, borrowers are not required to purchase PMI, regardless of putting zero money down.

    How Does the VA Define “Spouse”?

    As with any government program, specific definitions play a central role in determining eligibility for the VA Home Loan. As such, it’s important to outline exactly how the Department of Veterans Affairs defines a spouse, because this definition is necessary to understand who qualifies as a surviving spouse.

    The Department of Veterans Affairs recognizes a spouse if the “marriage was recognized under the law of the place where at least one of the parties resided when they were married.”  For example, if either the service member or spouse lived in New York when they were married, and the state of New York recognizes the marriage, then so does the VA.

    Furthermore, the “VA now recognizes all same-sex marriages without regard to a Veteran’s current or previous state of residence.”  This is a particularly relevant clause, as it expands VA benefit eligibility to same-sex spouses, regardless of state of residence.

    VA Home Loan Surviving Spouse Eligibility Requirements

    Having defined spouse, we now need to define surviving spouse with respect to VA Home Loan eligibility.  Per the VA’s guidance, surviving spouses need to receive a Certificate of Eligibility, or COE, to use VA Home Loan benefits.

    To receive a COE for the VA Home Loan as a surviving spouse, the veteran to whom you were married must meet at least one of the below criteria:

    • Is missing in action
    • Is a prisoner of war (POW)
    • Died while in the service or from a service-connected disability and you didn’t remarry
    • Died while in the service or from a service-connected disability and you didn’t remarry before turning 57 or before Dec. 16th, 2003
    • Had been classified as totally disabled and then died, but their disability wasn’t the cause of death (in certain situations)

    However, the above criteria were slightly expanded by the Veterans’ Millennium Health Care and Benefits Act. Following the passage of this act, surviving spouses who remarried can still use the VA Home Loan as long as they:

    • Remarried but are now divorced from the new spouse
    • Remarried but the marriage ended due to the death of the new spouse

    While the above criteria may seem complicated and overwhelming – as with most government jargon – surviving spouses simply need to go down the above list to confirm whether their deceased veteran spouse met one of these criteria.  If so, you qualify to use the VA Home Loan.

    Using the VA Home Loan as a Surviving Spouse

    Once you confirm that you qualify for the VA Home Loan, the next step is figuring out how to actually use the loan program.  As stated above, the first step to using the loan is receiving a COE from the Department of Veterans Affairs.

    This COE is the official government notification to lenders that you are, in fact, eligible to use the VA Home Loan (of particular interest to lenders, because the VA guarantees a large portion of these loans).

    Broadly speaking there are two ways to receive your COE as a surviving spouse:

    • Option 1 (the harder way): Fill out an application and apply for a COE directly with the Department Veterans Affairs.
    • Option 2 (the easier way): If you’re working with a lender familiar with the VA Home Loan program, they’re also likely familiar with the COE requirement. Ask your lender to apply for the COE on your behalf – they’ll collect any necessary information from you and work with the VA directly (far easier process, as lenders are used to doing this).

    Once a surviving spouse has received the COE, using the VA Home Loan is essentially the same as using any other mortgage (that is, receive lender pre-approval, find a house, make an offer, etc).

    But, it’s important to note that for surviving spouses – and any VA Home Loan users – receiving a COE does not guarantee that you will be approved for a loan.  The VA guarantees loans; it does not actually make loans.  Your respective lender will review your financial situation to determine whether you qualify for the actual loan.

    Additional Surviving Spouse VA Home Loan Benefits

    In addition to the VA Home Loan itself, surviving spouses are also eligible for two related benefits:

    • VA Home Loan funding fee exemption: While the VA Home Loan doesn’t require a down payment, borrowers will still need to pay closing costs. And, the VA funding fee is a one-time fee up to 3.6% of the loan amount that is either A) paid in cash at closing, or B) rolled into the loan principal, thus increasing the APR over the life of the loan. Surviving spouses are exempt from this fee, potentially saving them thousands of dollars.
    • Streamlined VA mortgage refinancing: Most loan refinances require income reverification, but a streamlined mortgage refinance does not. As long as the surviving spouse was on the original VA loan, he or she can access this streamlined refinance, lowering interest rates and monthly payments. This is particularly valuable to surviving spouses who would not otherwise qualify for a conventional loan refinance.

    Final Thoughts

    As a surviving spouse, you’ve served your country. While nothing can replace your loved one, receiving VA Home Loan benefits is one small way the US Government attempts to show its appreciation.

    And, while the loan process may seem intimidating at first, a lender familiar with the VA Home Loan program will guide you step-by-step through the entire process.



    About The AuthorMaurice “Chipp” Naylon spent nine years as an infantry officer in the Marine Corps. He is currently a licensed CPA specializing in real estate development and accounting.


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    Written by MilitaryBenefits