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Home ยป Military ยป 5 Tips for Military Service Members Purchasing a New Home

5 Tips for Military Service Members Purchasing a New Home

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Photo Credit: Raul Najera from Unsplash

Purchasing a home is complex, and even more so for military
service members, where the uniqueness of a military career extends to the home
buying process. As you navigate this experience, here are a few tips to keep in
mind.

VA Loans Are Trickier Than You Think

A consistent piece of advice youโ€™ll hear as you begin this process is to familiarize yourself with the Veteran Affairs Home Loans. These loans, available to military service members to help with the expenses of homebuying, are a huge benefit you should definitely consider.

Why are they so helpful? Part of the loan is guaranteed by the
U.S. Department of Veteran Affairs, meaning lenders are able to provide more
favorable loans. Purchase Loans, Streamline Refinance Loans, Adapted Housing
Grants โ€“ these and more are available to military members based on various
eligibility requirements. Length of service and duty status are some of the factors
considered.

VA Loans Arenโ€™t the Only Option

Just because VA loans are available to you doesnโ€™t mean you
shouldnโ€™t do your research. Service length, ability to make a down payment, how
long you plan to live in the home โ€“ all of these can play a factor into your
loan decision. While VA loans are only available to service members, that
doesnโ€™t mean theyโ€™re the only loan available to you. By putting in a bit of legwork,
youโ€™re setting you and your family up for success.

VA Loans Donโ€™t Necessarily Cover Everything

One thing youโ€™ll likely learn about in your research is that VA loans can offer 100 percent financing, meaning youโ€™re not required to pay a down payment. Additionally, you often arenโ€™t required to purchase private mortgage insurance, or PMI, which is required for down payments of less than 10 percent.

That being said, this doesnโ€™t mean there arenโ€™t any associated fees. Closing costs are not factored into the loan, and on average are between 2 and 5 percent of the overall purchase price of the home. There is also the VA Funding Fee, a sort of โ€œpay it forwardโ€ system to ensure VA home loans will continue to be an option for future service members. This is a set fee, somewhere between 1.5 and 3.3 percent of the loan, paid upfront or rolled into the overall loan.

Temper Your Expectations

Something all homebuyers struggle with regardless of profession is
understanding that purchasing a home is a multi-year commitment. While families
donโ€™t necessarily need to stay in one home for their entire lives, purchasing a
home is typically not a responsibility you can shirk in a few months. Plan for
the long term, and be realistic about your situation.

Are you still active duty, and have a high chance of being
relocated? This might not be the best time. Are you coming to the end of your
career, and plan to retire in the same area youโ€™ve been stationed for the last
few years? Sounds like youโ€™re in the best possible position to know the local
market and make an informed decision. No matter your situation, being realistic
about the time and commitment that comes with being a homeowner will make
things easier down the line.

Ask Questions

Finally, donโ€™t hesitate to ask questions throughout the process!
Reach out to people who are familiar with how the VA home loans work, including
other service members who have gone through the process. Encourage other
immediate family members to be involved in the process, as their perspectives
will help you see any issues with your plans. The home-buying process requires
a lot of attention and energy, but with the help of others and by familiarizing
yourself with the unique benefits available for service members, your dream
home is within reach.

Ready to begin the home buying process? Follow NewHomeSource
on social media, and check out the website for more informational articles and
current listings.

Personal leaning against a colorful mural, smiling and looking at the camera.
Mia Zozobrado

Mia Zozobrado joined Builders Digital Experience (BDX) in 2019 as a content writer. A graduate of Southwestern University with a degree in English, Mia is passionate about the written word and making connections. Outside of work, Mia also serves on the Board of Directors for the Writersโ€™ League of Texas.

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