Ask Scott & JJ > , , > Here’s one reason not to avoid a VA loan

Here’s one reason not to avoid a VA loan

August 29, 2012 • J.J. Montanaro

Q: I would like to know if I applied for a VA loan would I still get BAH? Don’t know if you would know but my wife and I fig­ured we would ask the question.

–Dar­ian, Repub­lic of Korea

A: If you’re not liv­ing in gov­ern­ment quar­ters, you should receive Basic Allowance for Hous­ing (BAH). How much you get is based on your rank, depen­dency sta­tus and your duty sta­tion zip code.  Here’s a link to the DoD BAH cal­cu­la­tor. The BAH will be the same whether you rent an apart­ment, lease a home, or use a VA loan to buy a home. Obvi­ously, buy­ing a home is a long term com­mit­ment, so you want to crunch the num­bers (includ­ing taxes, insur­ance, pro­jected main­te­nance, home­own­ers asso­ci­a­tion fees, etc.) before you buy and walk through the “what-ifs” before you sign on the dot­ted line (what if we get PCSed early, etc.). Inter­est rates are his­tor­i­cally low and home val­ues still haven’t fully recov­ered, but there are no guar­an­tees when it comes to buy­ing a home, so if you’re not sure buy­ing is the right deci­sion, use that BAH to rent. But rest easy, using a VA loan will not impact your BAH. Good luck.

Share |

USAA or its affiliates do not provide tax advice. Taxpayers should seek advice based upon their own particular circumstances from an independent tax advisor. The information is provided for informational purposes only and is not intended to substitute for obtaining professional financial advice. Please thoroughly research and seek professional representation before acting on any information you may have found in this article. This article is in no way attempts to provide advice that relates all personal circumstances.

Examples given are hypothetical illustrations and not an indication of the benefits or features of any USAA product. You should seek policies and advice based upon your own particular circumstances. Sample loans are for illustration purposes only and are not a rate quote, pre-approval, or commitment to lend.

June Walbert is a CERTIFIED FINANCIAL PLANNER TM practitioner with USAA Financial Planning Services, one of the USAA family of companies. Certified Financial Planner Board of Standards, Inc. owns the certification marks CFP® and Certified Financial Planner TM in the United States, which it awards to individuals who successfully complete CFP Board's initial and ongoing certification requirements.

USAA Financial Planning Services® refers financial planning services and financial advice provided by USAA Financial Planning Services Insurance Agency, Inc. USAA Financial Planning Services Insurance Agency, Inc. (known as USAA Financial Insurance Company in California, Lic. #0E36312), a registered investment adviser and insurance agency and its wholly owned subsidiary, USAA Financial Advisors, Inc., a registered broker dealer. (known as USAA Financial Insurance Agency in California), a registered investment adviser and insurance agency and its wholly owned subsidiary, USAA Financial Advisors, Inc., a registered broker dealer.

USAA means United Services Automobile Association and its affiliates. Investments provided by USAA Investment Management Company and USAA Financial Advisors Inc., both registered broker dealers. Banking products provided by USAA Federal Savings Bank. Credit cards provided by USAA Savings Bank. Both Banks Member FDIC.