Buying a home as a service member comes with a lot of perks. The process and loan eligibility requirements are vastly different from buying a home as a regular citizen. The law mandates that service members be rewarded with perks that empower you to buy your own home.
Housing Options
There are several housing options for service members. Many service members are opting for off-base housing, but there are also benefits to living inside the base.
- Government-owned Base Housing – If you want to save on housing costs, the best option is to live in homes owned by the Department of Defense. The military covers rent and utilities.
- Privately-owned Base Housing – The defense department partners with private companies to create housing on its bases. The property developers own and manage these homes, but service members can receive Basic Allowance for Housing (BAH) to cover rent and utilities.
- Off-base Housing – Some families, of course, want to raise their children outside military installations. You have to shoulder the costs outside your BAH, as well as other out-of-pocket costs.
Loans
You can avail of conventional home loans, but the most practical would be the one offered through the Department of Veteran Affairs (VA). This loan allows active and retired service members and their spouses to be homeowners. The financing covers up to 100% of the total cost of the property.
Here are the benefits of VA loans:
- No down payment
- No mortgage insurance
- Lower average interest rates
- Limits on closing costs
- More lenient credit requirements
Service members will qualify easier for VA loans than conventional loans. When you apply for a VA loan, you just have to provide the lender with a certificate of eligibility. You can get this after producing service-related documentation, which will depend on whether you are on active duty or a veteran.
The VA loans are provided for by private lenders but guaranteed by the Veterans Affairs, which also dictates the qualifying standards and terms. You will make the repayments to the private lenders. However, if there’s a risk of default, you can ask for assistance from the VA. You can also opt to pay for the loan early with no prepayment penalty.
Once you are ready to buy a home, talk to the VA’s human resource department to know if you are qualified for a VA loan. The process is usually smooth. When your home is ready for a move-in, the next thing you have to do is figure out which full-service moving company is right for you.