VA loans getting cheaper?
Not really but they just made homeownership more affordable for uniformed service members..
The Department of Defense (DOD) recently announced increases to the Basic Housing Allowance (BAH) for servicemembers, which will make the monthly payments on your VA loan easier to manage.
The Basic Allowance for Housing (BAH) is based on geographic duty location, pay grade, and dependency status. The intent of BAH is to provide uniformed servicemembers accurate and equitable housing compensation based on housing costs in local civilian housing markets, and is payable when government quarters are not provided.
Search for BAH by zip code
BAH rates are based on the combination of local costs for rent, utilities and renter’s insurance for various housing types. Any fluctuation of one or more of those factors in a given location will affect BAH rates for that location..
Related: What is a Certified Military Housing Specialist?
Since 2008 the BAH rates are directly related to the cost increases of the local rental housing markets.
Local BAH (Basic Allowance Housing) Rates for 2013
(E5 w/ Dependants)
|
Duty Station |
BAH 2012 |
BAH 2013 |
% Change |
| Camp Pendleton |
$1929 |
$2025 |
4.9% |
| Riverside |
$1743 |
$1737* |
-.04% |
| San Diego |
$2133 |
$2139 |
.28% |
* The servicemember who is already attached to his or her unit and receiving BAH will receive any published BAH increase, but no decrease.
What is BAH?
The intent of BAH (Basic Allowance Housing), is to provide uniformed servicemembers accurate and equitable housing compensation based on housing costs in local civilian housing markets, and is payable when government quarters are not provided.
What determines my BAH ?
The Basic Allowance for Housing (BAH) is based on geographic duty location, pay grade, and dependency status.
Any active duty service members who see a drop in BAH for their locality will have their BAH protected, thanks to "individual rate protection," which was adopted by Congress over a decade ago.
How is BAH calculated?
Since 2008 the BAH rates are directly related to the cost increases of the local rental housing markets. According to the DoD, BAH rates now make it possible for servicemembers to have zero out-of-pocket expense -- for service members living in civilian rented housing.
How is my BAH used if I’m looking to buy a home?
BAH is considered as income just like your base pay, with one important exception. While base pay is subject to income tax, BAH and other allowances are not. Underwriting guidelines for VA loans allow lenders to “gross up” your BAH up to 25% when determining qualifying income.
Let’s take a look at the chart with your BAH grossed up.
Local BAH (Basic Allowance Housing) Rates for 2013
(E5 w/ Dependants)
|
Duty Station |
BAH 2013 |
BAH 2013 (+25%) |
|
Camp Pendleton |
$2025 |
$2531 |
|
Riverside |
$1737 |
$2171 |
|
San Diego |
$2139 |
$2673 |
If you’re looking to buy your first home in Riverside or San Diego County, in many cases your BAH will be equal to or greater than the monthly payment on your VA loan, which will help you better manage the costs of homeownership.
We have helped countless servicemembers and their families, make the right home buying decision and they all have one thing in common, they contacted us.
Contact a Certified Military Housing Specialist
