Since the Supreme Court ruled that the Defense of Marriage Act (DOMA) is unconstitutional, there may be some fallout in the world of mortgage — specifically, VA mortgages.
VA home loans are fully available to couples, married or unmarried, as long as both parties are eligible for VA benefits — that is, they are qualifying servicemembers, veterans or surviving spouses. However, if only one of the parties qualifies on his or her own for VA financing, a married couple can still borrow the maximum amount, as long as one member is a man and the other a woman. Same sex married couples are allowed only the reduced benefit of non-married joint buyers.
The VA explicitly states that a “spouse” must be someone of the opposite sex. That means married same-sex couples don’t have the same mortgage benefit as traditional marrieds when it comes to VA home loans.
Does the DOMA Decision Affect VA Mortgages?
That’s a question many mortgage experts are asking. The DOMA was struck down as unconstitutional when challenged by a widow who was ordered by the IRS to pay hundreds of thousands in estate taxes when her wife passed away — taxes that wouldn’t have been owed had they been a traditional mixed-gender couple. So we have some similar elements to the current VA policy:
- A federal agency (the IRS)
- A same sex couple legally married in their state
- Disparate treatment based solely on gender
More importantly, we have a Secretary of Defense who has openly committed to changing policies.
The DOD released a statement from Defense Secretary Chuck Hagel soon after the decision:
“The Department of Defense welcomes the Supreme Court’s decision today on the Defense of Marriage Act,” it read. “The Department will immediately begin the process of implementing the Supreme Court’s decision in consultation with the Department of Justice and other executive branch agencies.
The Department of Defense intends to make the same benefits available to all military spouses — regardless of sexual orientation — as soon as possible. That is now the law, and it is the right thing to do.
Every person who serves our nation in uniform stepped forward with courage and commitment. All that matters is their patriotism, their willingness to serve their country and their qualifications to do so. Today’s ruling helps ensure that all men and women who serve this country can be treated fairly and equally, with the full dignity and respect they so richly deserve.”
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