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Military Divorce and the House

When one spouse serves or served in the military, federal rules on retired pay, court timing and VA loans sit on top of Alabama divorce law. Here is how they affect the house, and where Redstone families can get help.

Reviewed October 31, 2026 by George Lensch, broker, Wyze Realty. General information about Alabama, not legal, tax or financial advice.

Why Military Divorces Have Extra Steps

The Huntsville area is home to many active-duty families, retirees and Redstone Arsenal workers. When one spouse serves or served in the uniformed services, a few federal rules sit on top of Alabama divorce law. Most of them are about retired pay and court procedure, not the house, but they can change the timing of a sale or buyout and what a settlement trades. Alabama law still decides how the house itself is divided: equitably, not automatically 50/50 (Ala. Code 30-2-51).

Many Redstone families are civilian Defense Department or contractor employees. The federal military rules below apply to uniformed service members and their retired pay. If your family's pension is a federal civilian one, ask your attorney how it is handled.

Retired Pay Is Not the House

The Uniformed Services Former Spouses' Protection Act (USFSPA, 10 U.S.C. 1408) lets state courts treat disposable military retired pay as property that can be divided. Key points:

• A former spouse has no automatic right to retired pay. The court has to award it.
• For property division, a former spouse can receive up to 50% of disposable retired pay, or up to 65% when combined with garnishment for support.
• Direct payment from DFAS requires the "10/10 rule": at least 10 years of marriage overlapping at least 10 years of creditable service. Without the overlap, the order can still be valid, but payments come from the member rather than DFAS.

Why it matters for the house: settlements often trade retirement value for home equity. One spouse keeps more of the house; the other keeps more of the retired pay or another account. Those assets are taxed and paid differently, so have your attorney and a CPA compare them on equal terms.

Timing: The SCRA Stay

The Servicemembers Civil Relief Act lets a servicemember who is a party to a civil case, divorce included, ask for a stay of at least 90 days when military duty materially affects their ability to appear. The request generally needs a statement from the servicemember and a letter from their commanding officer (50 U.S.C. 3932). The protection also covers a person within 90 days after leaving service. The SCRA also protects servicemembers who have not appeared in a case from default judgments; an affidavit about military status is required (50 U.S.C. 3931).

For the house, a stay can mean the divorce, and any court-ordered sale or buyout deadline, takes longer. Plan for mortgage, insurance and upkeep during that time, and put who pays in writing.

Facing a PCS move and a divorce at the same time? Call (256) 808-6861 or schedule a confidential call. There is no cost and no obligation.

VA Loans and Divorce

A VA loan follows the veteran's entitlement, which changes the buyout picture:

VA servicers have their own requirements, so ask the servicer for its current list in writing. A refinance by the spouse who keeps the house, into a loan in their own name, is the other common route. Federal law also keeps a transfer to a spouse under a divorce decree from triggering the due-on-sale clause (12 U.S.C. 1701j-3(d)(7)), but that does not release anyone from the loan.

Buyout Numbers

PCS Orders, Distance and the House

A permanent change of station can arrive in the middle of a divorce. If one spouse is moving away:

• Decide early whether the house will be sold, bought out, or kept for now, because selling from another state takes more coordination.
• Ask the closing attorney early about signing documents from a distance, including whether they accept a power of attorney. While you are married, the other spouse generally has to sign a deed or mortgage of the homestead (Ala. Code 6-10-3).
• If renting the house out is on the table, both spouses on the deed and the loan stay connected to it. Our sell, rent or keep page compares the choices.
• See also selling with PCS orders and selling from out of state.

Sell, Buy Out or Hold When Orders Come

Signing While Deployed or Away

Everyone on the deed signs a sale, and while you are still married the other spouse generally must sign a deed or mortgage of the homestead too (Ala. Code 6-10-3). If a servicemember will be deployed, in training or stationed elsewhere when the house sells or refinances:

• Ask the closing attorney or title company early what they accept, such as a specific power of attorney for this property, or signing in advance.
• Redstone Arsenal Legal Assistance offers notary services and powers of attorney on a walk-in basis for eligible people. Ask the closing attorney what the power of attorney must say before you have it prepared.
• Build extra time into contract deadlines for documents that have to travel.

Tax Notes for Military Families

The same federal tax rules apply as in any divorce. A transfer of the house between spouses incident to divorce is generally not taxed, and the receiving spouse takes the other spouse's basis (IRS Publication 504). For the home sale exclusion, a spouse who moves out, including because of orders, can count the other spouse's use of the home only if a divorce or separation instrument allows that spouse to live there (IRS Publication 523). Ask a CPA how orders and moves affect your timing.

Settlement Points Military Families Often Raise

These are common topics, not legal advice. Your attorney can tell you which apply:

• How the house is weighed against the division of retired pay.
• Whether a VA loan will be refinanced, assumed, or paid off, and what that means for the veteran's entitlement.
• Deadlines that allow for deployments, training and PCS moves.
• Who manages the house, and who pays for it, if both spouses leave the area before it sells.
• How either spouse will sign documents if they are away.

Choose a Path

Where Military Families Can Get Legal Help

Because Redstone serves people from Madison, Limestone and Morgan counties, the case may be filed in any of them. Each county's circuit clerk is listed on the main divorce guide.

Common Questions

Does the USFSPA decide who gets the house?

No. The USFSPA (10 U.S.C. 1408) lets state courts divide military retired pay. The house is divided under Alabama law as part of the marital estate.

What is the 10/10 rule?

It controls whether DFAS pays a former spouse's share of retired pay directly: at least 10 years of marriage overlapping 10 years of creditable service. Without it, the court order can still be valid, but payments come from the member.

Can a deployed servicemember delay the divorce?

Under the SCRA, a servicemember whose duty materially affects their ability to appear can ask for a stay of at least 90 days, with a statement and a commanding officer's letter (50 U.S.C. 3932).

If I keep the house with my spouse's VA loan, what happens to their entitlement?

If the non-veteran spouse assumes the loan, the veteran's entitlement generally stays tied to it unless an eligible veteran substitutes entitlement. Ask the VA servicer for its requirements.

Can the non-veteran spouse be released from a VA loan?

If the veteran keeps the home, the non-veteran spouse can generally be released, typically with the final decree, a recorded deed and insurance in the veteran's name. Confirm with the servicer.

Does Redstone Arsenal Legal Assistance handle divorces?

It serves eligible active duty members, retirees and dependents. Call (256) 876-9005 to ask what help is available for a divorce matter.

Can we sell the house if one of us has PCS orders?

Yes, with planning. Everyone on the deed signs, and while you are married the other spouse generally must sign a deed of the homestead (Ala. Code 6-10-3). Ask the closing attorney early about signing from a distance.

Do these rules apply to civilian Redstone employees?

The USFSPA and SCRA rules here apply to uniformed service members. Civilian federal pensions follow different rules, so ask your attorney.

Talk It Through, Confidentially

Big decisions are easier with someone in your corner. Whether you are ready to sell, still deciding, or just need to understand your options, call or schedule a time to talk. The first conversation is free, private and comes with no obligation. If what you really need is an attorney, a CPA or a housing counselor, we will tell you that and point you in the right direction.

Schedule a Confidential Call Call or Text (256) 808-6861

Sources

• Maryland People's Law Library, military retirement pay in divorce (USFSPA, 10 U.S.C. 1408)
• 50 U.S.C. 3932 (SCRA stay of proceedings)
• 50 U.S.C. 3931 (SCRA protection against default judgments)
• Ala. Code 30-2-51 (division of property)
• Ala. Code 6-10-3 (spouse's signature on homestead conveyance)
• 12 U.S.C. 1701j-3 (Garn-St Germain, due-on-sale exceptions)
• IRS Publication 504, Divorced or Separated Individuals
• IRS Publication 523, Selling Your Home
• Military OneSource, Redstone Arsenal Legal Assistance
• Alabama State Bar, Get Legal Help (Lawyer Referral Service and volunteer lawyer programs)
• Madison County Circuit Clerk, Family Division

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Wyze Realty LLC, Huntsville, Alabama. Information on this page is general and educational, is not legal, tax, financial or credit advice, and may not reflect the most current law. Consult an Alabama attorney, CPA or HUD-approved housing counselor about your situation. All real estate services are provided in accordance with the Fair Housing Act.