How Much Money Do You Get to Buy a House in the Army?
The United States Army doesn't give its members money specifically for buying a house. It does, however, provide officers and enlisted members basic allowance for housing, or BAH. The BAH is a monthly payment intended to offset the cost of rent when Army members cannot live in government-provided housing. Members of the Army also have access to programs, loans and grants that may make home ownership more affordable.
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Veterans Affairs Loans
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Access to a Veterans Affairs loan is one of the largest benefits a veteran receives. The government essentially guarantees up to $417,000 of an eligible veteran's home loan. This guarantee often provides a veteran access to lower mortgage interest rates than he would have enjoyed otherwise. This loan can be applied to the purchase of a home, condominium or manufactured home, according to the Military.com website. A VA loan can also be used to build or repair a home or to refinance an existing home, the site notes.
BAH Strategy
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The Army's basic allowance for housing is meant to compensate for the cost of housing when soldiers must live off base, according to the Go Army website; rates vary based on location, rank and family status. Some soldiers choose to live in the most economical off-base housing available and save their extra BAH money every month. Over time, these savings may be enough to provide a down payment for a house or other comparable investment.
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Housing Assistance Program
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The Department of Defense website notes that Congress created the Homeowners Assistance Program (HAP) in 1966 to compensate eligible military homeowners when a base closing or reduction slammed the local real estate market and forced them to sell their nearby homes at a loss. In 2005, the DOD began a reorganization of U.S. military bases to increase efficiency. This resulted in some bases being pared down or closed.
The American Recovery and Reinvestment Act of 2009 expanded HAP to include groups such as deployed wounded, injured or ill homeowners of the Armed Forces "reassigned for medical treatment or rehabilitation or due to medical retirement in connection with their disability"; surviving spouses of fallen soldiers; and certain military homeowners relocating during the mortgage crisis due to base closures or permanent change of station moves.
Some provisions of the HAP expansion will expire in 2011, but according to the DOD website, the HAP extension will remain in force during 2012 for eligible permanent change-of-station homeowners with orders dated between February 1, 2006, and September 30, 2010. For service members and civilian employees who had to move or who were otherwise affected by the 2005 DOD's base realignment and closure reorganization, HAP will continue through September 2012. Eligible wounded, injured or ill homeowners, or eligible surviving spouse homeowners will still have HAP, which will be extended "indefinitely."
Pentagon Foundation Grants
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The Pentagon Federal Credit Union Foundation offers grants of up to $5,000 to eligible military families toward the down payment or closing costs of their first home. You don't have to be a member of the credit union to apply, according to the site. Active duty, reserve, national guard or veteran members of the military are eligible to apply if they are first-time homebuyers, haven't owned a home in three years or have lost their home through divorce or disaster. Gross household income, including allowances, cannot exceed $55,000 a year,
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References
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