Home Ownership after Loss of Entitlement to SFA

Exploring home ownership following relationship breakdown or unexpected discharge from the Armed Forces.

Who this guide is for

If you're facing the loss of your entitlement to Service Family Accommodation (SFA), finding somewhere else to live will be a priority. But where you live immediately after leaving SFA doesn't necessarily have to be your longer-term home.

This guide looks at whether buying a home could be an option, how much time you might have and where you can find support.

This guide covers two different situations. You can go straight to the section that's relevant to you:

• Relationship breakdown — where the serving person and their spouse or partner may each need to find somewhere else to live.

• Unexpected discharge — medical discharge, disciplinary discharge or compulsory redundancy.

If you're approaching the normal end of your Service or planning to retire, our upcoming Leaving Service guide will be more relevant to you.

01: Relationship breakdown

When a relationship breaks down, the serving person and their spouse or partner may need to make separate housing plans. Buying a home could be an option for one, both or neither of you.

What happens to your SFA?

1. Separation. When a relationship breaks down, the serving person should speak to their chain of command about arranging a cooling off period. The MOD officially calls this a reconciliation period, and up to 93 days can be authorised. During this time, the serving person will normally move into Single Living Accommodation (SLA) or private accommodation, while their spouse or partner remains in SFA. The period starts when the serving person moves out.

2. What happens next? If the relationship has ended, the serving person must confirm this by informing their chain of command and the MOD Loss of Entitlement Team. This normally happens when the 93 days are up, or earlier if both people agree the separation is permanent. However, if the relationship gets back on track during this time, the serving person can return to SFA.

3. Notice to Vacate. Once the separation becomes permanent, the MOD will issue a 93-day Notice to Vacate. This provides time to find somewhere else to live and is separate from the earlier cooling off period.

4. Additional time. If you're buying a home and the purchase hasn't completed as that deadline approaches, you can ask the MOD for more time. Extra time isn't guaranteed, but it may be possible depending on your situation.

Could buying a home be an option?

For the serving person. Your Armed Forces income may put you in a position to buy a home, and Forces Help to Buy could help with your deposit and other buying costs. However, bear in mind any financial commitments following the separation, including maintenance payments, could affect how much you can borrow. If buying on your own income looks difficult, affordable home ownership schemes such as Shared Ownership may offer another route onto the property ladder.

For the spouse or partner. Buying a home may still be possible, even if your income is limited. Most mortgage lenders will also consider any regular maintenance payments you may be receiving, which can increase how much you're able to borrow. Affordable home ownership schemes, including Shared Ownership, may also help you buy the home you need if your income alone isn't enough.

02: Leaving the Armed Forces unexpectedly

Leaving the Armed Forces unexpectedly can mean having to find somewhere else to live sooner than you had planned. How much time you have to leave SFA will depend on the reason for your discharge. If you're considering buying a home, your income after leaving Service will also be important.

What happens to your SFA?

Medical discharge

If you're being medically discharged, you'll normally receive a Notice to Vacate giving you 93 days after your discharge date to leave SFA.

Compulsory redundancy

If you're being made redundant with six months' notice or less, you'll normally receive a Notice to Vacate giving you 93 days after your discharge date to leave SFA. If you've been given more than six months' notice, different arrangements may apply, so check your Notice to Vacate for the date you need to leave.

Additional time

In both situations, you'll continue paying the usual accommodation charges during the initial 93 days. If you need longer, you can ask the MOD for an extension of up to a further 93 days. Extensions aren't guaranteed, and higher accommodation charges will apply if one is approved.

Disciplinary discharge

If you're being discharged for disciplinary reasons, you may receive as little as 28 days' notice to leave SFA. If you need more time, contact the MOD Loss of Entitlement Team immediately to discuss your situation. Additional time isn't guaranteed.

Your income after leaving Service

If you're approaching discharge or redundancy, mortgage lenders will need to consider what income you'll have after leaving the Armed Forces. Even though you're still receiving your military pay, they may not be able to use it when assessing how much you can borrow.

For many people, securing a new civilian job will therefore be an important step towards buying a home. The good news is that you don't necessarily need to have started that job before applying for a mortgage. Some lenders will accept income from a future job, provided you have a confirmed offer or employment contract and meet their requirements.

A partner's income or an Armed Forces pension may also help, but if you'll be relying mainly on your own earnings, having your next job arranged could make all the difference. This is why it's worth exploring your mortgage options as early as possible.

Could buying a home be an option?

Medical discharge or compulsory redundancy. Being medically discharged or made redundant doesn’t necessarily mean you can’t get a mortgage. You may also receive a lump sum payment that could help towards buying a home. The earlier you explore your options, the more time you’ll have to plan your next move.

Disciplinary discharge. With so little notice, completing a house purchase before leaving SFA is highly unlikely unless you're already well into the buying process. However, that doesn't necessarily mean buying a home isn't possible. You may need temporary accommodation while you explore your options or complete a purchase.

03: What to consider when buying a home

Whether buying a home is possible will depend on your finances, the mortgage options available to you and how much time you have. You don't need to have found a property before speaking to a mortgage adviser, who can help you establish what may be possible and how much you could borrow.

What will a mortgage lender consider?

Mortgage lenders will look at your income, including any earnings from a partner, pension income or maintenance payments. They'll also consider your regular spending, financial commitments, credit history, deposit and the property you want to buy. Different lenders take different approaches to assessing mortgage applications, which means you may have more options than you realise.

What could you afford?

A mortgage adviser can help you work out how much you might be able to borrow and what your monthly repayments could look like. You'll also need to consider how much money you have available towards the purchase, along with other costs such as legal fees, surveys and moving expenses. Understanding these figures early can help you decide what sort of property may be affordable.

How long can buying a home take?

Buying a home can take several months, although some purchases complete more quickly than others. The timescale will depend on factors such as finding a suitable property, arranging the mortgage and completing the legal work. Starting the process early can help you make the most of the time available before you need to leave SFA.

What if your purchase takes longer than your SFA notice period?

If your home purchase is unlikely to complete before you need to leave SFA, contact the MOD Loss of Entitlement Team as early as possible to ask whether you can have more time. You'll need to show that your purchase is progressing, including evidence of your mortgage arrangements and an expected completion date. Additional time isn't guaranteed, so it's important to consider what you'll do if you can't remain in SFA.

04: Affordable Home Ownership

If buying the home you need on your income alone looks difficult, affordable home ownership schemes may offer another option. These could be particularly helpful following relationship breakdown, especially for military spouses who may be looking to buy a home on their own for the first time.

There are different ways these schemes can help. For example, Shared Ownership allows you to buy a share of a property and pay rent on the rest, meaning you may need a smaller mortgage and deposit. First Homes offers certain properties at a discounted price, making them more affordable to buy.

Some schemes also offer additional advantages to Armed Forces personnel and their families, which can make buying a home easier. Our separate Affordable Home Ownership guide explains the different schemes, including the special arrangements available to the Armed Forces community.

05: Forces Help to Buy

Forces Help to Buy allows serving Armed Forces personnel to borrow up to 50% of their annual basic pay, to a maximum of £25,000, interest-free, towards buying a home.

If you're the serving person following a relationship breakdown, this could make a real difference. For some, the loan could cover the entire deposit and other home-buying costs, meaning you may be able to buy a home with little or no savings of your own. You'll normally need more than six months of Service remaining, so the scheme is unlikely to be available to those leaving the Armed Forces unexpectedly. Our separate Forces Help to Buy guide explains how the scheme works and who can use it.

06: What happens next?

If you want to buy but need somewhere to live in the meantime

If you haven't found a property or your purchase won't be completed before you have to leave SFA, you may need somewhere to live temporarily. Options could include staying with family or friends, private renting, the Services Cotswold Centre or accommodation available through Armed Forces support organisations. What is available will depend on your situation, but these arrangements could give you more time to find and buy the home you need.

If buying isn't right or possible for you

Buying a home won't be the right choice for everyone, and it may not be financially possible at the moment. If you've explored your mortgage options and decided not to buy, other housing options include private renting, council or housing association housing, and accommodation or support available through Armed Forces organisations.

Where to find housing information and support

There are several organisations that can help you explore your housing options. The MOD provides guidance on finding civilian accommodation, while the Families Federations offer practical information on separation, leaving SFA and alternative housing options. SSAFA and other Armed Forces charities may also be able to help with housing advice, temporary accommodation or financial support, depending on your situation.

MOD — A Home in Civilian Society — civilian housing, renting and social housing.

Army Families Federation — Separation and Divorce — separation and housing options.

RAF Families Federation — Relationship Support — relationship breakdown and SFA guidance.

Naval Families Federation — Short Term Accommodation — short-term accommodation options.

SSAFA — Housing Advice — housing advice and possible support.

What to do next

1. Check the date you need to leave SFA and contact the MOD Loss of Entitlement Team if anything is unclear.

2. Explore whether buying a home is possible, even if you haven't found a property yet.

3. If you decide to buy, start the process as early as possible and ask the MOD about additional time in SFA if you need it.

4. Consider your other housing options in case you cannot remain in SFA until your purchase is complete.

More than just mortgage advice

A mortgage adviser can help you understand how much you could borrow, find a suitable mortgage and explain the home-buying process. An Armed Forces specialist mortgage adviser will also understand military pay, Forces Help to Buy and how Service life can affect your mortgage options.

But when you're facing the loss of your SFA, there can be much more to consider than the mortgage itself. At PFL Mortgages, our Armed Forces advisers understand the different circumstances that can lead to losing your accommodation, the time you may have available and the options worth exploring. We can help you plan your next steps, work alongside your solicitor and other organisations involved, and support you throughout the buying process.

And because you're part of the Armed Forces community, you'll never pay us a fee.

Still have a question? There will always be situations a guide cannot fully cover. You can ask our Armed Forces advisers directly at pflmortgages.com/ask. Your question goes straight to our three Armed Forces advisers, and one of them will personally respond.