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My brother is thinking of joining the military but he is concerned about his mortgage because his mortgage is higher than his basic pay. In fact he would need to close be at least E5 to break even with his mortgage. I told him he can get BAH to pay his home but I am not sure if thats true. Can he receive BAH to pay his mortgage monthly?
Housing
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79R: Recruiter
Posted 5 y ago
Responses: 11
He gets BAH if he either a) has dependents or b) is allowed by his command to live off-post and draw BAH. Otherwise, he won't get it just because he has a mortgage to pay. That's not how the military pay system works.
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LTC Kevin B.
SPC Daniel Weinberger - I don't see anything in there that addresses the situation mentioned above. The only way I see that this policy would even apply would be if occupancy was really high (>95%) or if the soldier's house was in the Fort Gordon area. And, that policy would only apply while stationed at Fort Gordon. If the house was elsewhere, the policy wouldn't apply. If he were to PCS away from Fort Gordon, the policy would no longer apply either. That's aligning a lots of planets, and they'd only stay aligned for a short while.
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SPC (Join to see)
LTC Kevin B.
Finance offices go by The Army Barracks Management Program Handbook and there are temporary and permanent CNA’s available but they ultimately have to be approved by the garrison commander. (It’s a long and tedious process but it’s there for a reason).
Finance offices go by The Army Barracks Management Program Handbook and there are temporary and permanent CNA’s available but they ultimately have to be approved by the garrison commander. (It’s a long and tedious process but it’s there for a reason).
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LTC Kevin B. is right on. Compare the BAH rate at locations where your brother might be stationed to his mortgage plus taxes and insurance on the residence. Your brother may have to look at alternatives to owning a residence with such a high mortgage payment:
-Refinance the loan. Interest rates are very low right now. Might get the mortgage payment down.
-Decrease or eliminate PMI. PMI insures the lender against bowers who don't put enough down payment on a house. Usually 20% down is needed to get a conventional loan without PMI. Sometimes a refinance can get rid of PMI if there's enough equity in the home.
-Hold out long enough to refinance under VA. Service members become eligible for VA home loans after a period of service (look it up on the VA website). VA loans do not require a down payment and don't have PMI. This could allow a lower monthly payment.
-Rent the property. If the rental rates in the region are high enough to cover the mortgage and other costs of renting the property, then this might be a good choice. Plus if Brother can sustain a loss on the rental property on paper it could become a tax deduction. There is a lot of ass pain in being a landlord. I recommend talking to somebody who is a landlord in Brother's region for more insights.
-Sell the property. In many areas this might be a good choice. If Brother can break even or make a little money on the sale this might be the best idea. Not owning a house early in one's enlisted career with frequent moves and possible overseas moves or deployments can be a good idea.
-Refinance the loan. Interest rates are very low right now. Might get the mortgage payment down.
-Decrease or eliminate PMI. PMI insures the lender against bowers who don't put enough down payment on a house. Usually 20% down is needed to get a conventional loan without PMI. Sometimes a refinance can get rid of PMI if there's enough equity in the home.
-Hold out long enough to refinance under VA. Service members become eligible for VA home loans after a period of service (look it up on the VA website). VA loans do not require a down payment and don't have PMI. This could allow a lower monthly payment.
-Rent the property. If the rental rates in the region are high enough to cover the mortgage and other costs of renting the property, then this might be a good choice. Plus if Brother can sustain a loss on the rental property on paper it could become a tax deduction. There is a lot of ass pain in being a landlord. I recommend talking to somebody who is a landlord in Brother's region for more insights.
-Sell the property. In many areas this might be a good choice. If Brother can break even or make a little money on the sale this might be the best idea. Not owning a house early in one's enlisted career with frequent moves and possible overseas moves or deployments can be a good idea.
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Suspended Profile
If he wants to join, why not just sell his house?
LTC Jason Mackay
SFC (Join to see) - this is logical, but assuming this person will be a PV1-PFC (no information on if he qualifies to enter as an E4), this is a high risk move to rent this property. If he can't get to the property during emergencies, he'd need a rental agency and a contingency fund for emergency repairs. Provided everyone did what they were supposed to every month, he'd still need to charge the mortgage plus the rental company fee to break even. If something breaks, he is in it out of pocket.
If the property then goes vacant, family trashes the house, or his family defaults, then he is on the hook for all of it. This would be bow string tight under the best circumstances
If the property then goes vacant, family trashes the house, or his family defaults, then he is on the hook for all of it. This would be bow string tight under the best circumstances
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SFC (Join to see)
LTC Jason Mackay I get what you are saying. I was in a very similar situation when I joined. Mortgage had to be paid and I was PCSing to Ft. Wainwright, AK. I had to get what I could out of the house and make up the difference. I could not let it foreclose because of my security clearance.
You are right the place could get trashed, happened to me when a renter left, but I had no choice if I was going to remain in the Army.
You are right the place could get trashed, happened to me when a renter left, but I had no choice if I was going to remain in the Army.
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LTC Jason Mackay
SPC (Join to see) - slow boat option: your brother joins the ARNG or Army Reserve, then enlists AD when his contract is up (there is the option of conditional release but RP sits on a mountain of posts that this option is tough to get done). Your family has the next has a few years to sort this out. Which may eventually meet the same
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If he joins the Army Reserve, he I'd entitled to BAH while in training as a single Soldier. He will have to show proof of mortgage when in reception prior to basic training. If he goes Regular Army he will not be entitled to BAH.
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I would recommend he not join the military until he has a better understanding of how it will effect his life.
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No. Your brother will not receive BAH just because he has a mortgage. I would recommend he sell the house and place the proceeds in an index fund until he can move out of the barracks on his own without a commander's approval.
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He has to get a CNA which is an exception to policy for BAH. He has to have proof that he owns the house and pays the mortgage and has to have his 1SG, CDR, BN CDR and Brigade commander sign memos stating why it’s needed and a bunch of other documents including a 4187, 5960 and barracks and housing memos. I’ve completed one myself and it takes a long time. In my honest opinion He’s better off renting it out.
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So many factors, training length is a factor, duty station, pay grade, etc. have him do his research before doing anything.
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That is going to depend on his command and location. If he is single with no dependents then he is unlikely to get it. Even more so if he is stationed in an area with ample barracks space.
Just because he has a home with mortgage is not a reason for him to be allowed BAH. Even at that? If he did get it he would have to find a place off post to live, as he will likely not be stationed where his actual home is. Cannot have it both ways.
Just because he has a home with mortgage is not a reason for him to be allowed BAH. Even at that? If he did get it he would have to find a place off post to live, as he will likely not be stationed where his actual home is. Cannot have it both ways.
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*IF* and it is a big if, because it is highly unlikely, he gets BAH, he will not be authorized to live in the barracks. Which means he will need to find an apartment, and pay both mortgage and rent out of that BAH. And BAH will be based on duty location, so if he goes somewhere with lost cost of living (like Fort Polk or Fort Drum), BAH probably still won't cover mortgage, let alone mortgage plus rent.
His best bet is to sell (I understand family lives there so this is not ideal), rent (family can pay him to keep living there) or simply have remaining family take over mortgage payments until they move out or he finishes his time in service.
If the family is financially dependent on him, he may be able to claim them as dependents, and that COMPLETELY changes the entire conversation.
His best bet is to sell (I understand family lives there so this is not ideal), rent (family can pay him to keep living there) or simply have remaining family take over mortgage payments until they move out or he finishes his time in service.
If the family is financially dependent on him, he may be able to claim them as dependents, and that COMPLETELY changes the entire conversation.
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MAJ Byron Oyler
Even if the family is dependents he still will not get enough BAH for the house and enough left over to rent at the location he is stationed.
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