But wait; are you a military member or a veteran? If you are the news isn’t as bad. With your VA Guaranteed Home Loan benefit you can still obtain a loan with no down payment and a fixed interest rate that is as good as or better than a conventional mortgage rate. This is the time for a VA Loan! What a great benefit to those of you that have served our country!

What is a VA Guaranteed Home Loan?

Many have the misconception that the military is the organization loaning the money. No they are not. Your VA Guaranteed Home Loan will be made by a private lender, such as your bank or a mortgage company of your choosing that has VA lending approval.

The guaranty means the lender is protected if you fail to repay the loan. This is also why you will not have to pay private mortgage insurance (PMI) for a zero down loan (if you could find one). Normally a lender would require a down payment and/or PMI to obtain a loan, since the VA Home Loan has a guaranty which replaces these you will be able to obtain your loan without, but with the same financial terms as if you had made a down payment. The risk is removed for the lender when the VA gives them that guaranty.

Of course you still must meet income and debt requirements, your credit reports will be used and if there are items in your history that are derogatory you can be denied a loan even though you have your Certificate of Eligibility. The VA cannot demand a lender make a loan to you that would violate their lending practices.

Lenders also must comply with the VA rules and policies when it comes to income and credit standards. Just having the benefit is not enough, you must be credit worthy.

If a lender is unwilling to approve you for a loan the only thing the VA can do is suggest that you try other lenders.

It could just be the perfect time for you to purchase a home with your VA benefits. Interest rates are at all time lows and prices in the Kitsap area are amazing. There are some awesome deals out there. Now, remember that the housing market isn’t moving as fast as it was years past, so you must be able to stay in this home longer than that 3 yeas. So, if you have a plan to be here longer you just might want to jump at these low home prices.

UPDATED: Click this link and it will take you to the Military.com site for BAH – be sure you remember to look at with or without dependents. Also, remember that the rate is most likely for your base and not the city where you might live. Look at your last LES for the correct Zip Code. This new rate will be reflected in your paycheck you receive on January 15th, which covers the pay period Jan 1st through January 15.

2010 Basic Allowance for Housing Rates

Well, it’s almost that time of year! How many times over the last few weeks have you seen the question posted on military boards across the net?

If you look in the right places you will always find the right answer. I don’t hold much stock in military boards when it comes to important information. I always make sure that I find the source is a .mil site. That way you know the information is correct.

Here is the link that gives the date -

Basic Allowance for Housing (BAH)

The Department of Defense, Per Diem, Travel and Transportation Allowance Committee page is one worth making a bookmark!

I will be writing about and posting the Naval Base Kitsap new rates as soon as they come out so be sure to check back!

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Photo Credit:

U.S. Navy photo by Mass Communication Specialist 2nd Class Kevin L. Burleson (RELEASED)