How to Prepare Your Finances to Buy a Home as a Military Veteran

May 11, 2012 in Buying A Home Near JBLM, VA Loan Information for WA Leave a reply

Purchasing a home can be particularly hard for some military staffers. A veteran or other military careerist might not have a good grasp of a local real estate market, due to dislocation from deployment or other assignments. It’s tough handling active duty assignments while keeping track of personal finances. This can leave vets with less knowledge about personal credit scores and other aspects of individual or household financial status. There are some federal programs in place to help veterans buy homes, but it’s important to know where to look. Here are some of the basics for preparing to buy real estate as an active-duty or former military staffer.

Put Together Your Down Payment

Almost all loans, including VA loans and other military options, will require a down payment on a piece of property. In many cases, the larger down payment can help you avoid heavy interest charges over the duration of your mortgage. Think about how much of your savings and assets you can put towards a down payment without leaving you and your family vulnerable to future financial emergencies.

Evaluate What You Qualify For and Your Projected Monthly Mortgage Payment

Another good tip for military staffers, or anyone else, is to think about your monthly mortgage payment against your current and future income. Sometimes, buyers may feel pressured to look for the most expensive home that they can qualify for, where making higher consistent mortgage payments can threaten finances in the long run. Make sure that you will be comfortable with your financial responsibility each month.

Look for Fees and Closing Costs

Even a military home loan will include many kinds of fees and costs that may get charged up front or rolled into your future mortgage payments. Prominent experts on military mortgages point out that in lending, there is no “cost free” mortgage. Look for loan origination fees like a VA funding fee, lender’s fees and other extras that might get tacked onto your mortgage. You’ll also want to explore the issue of closing costs, and negotiate with the seller about how these costs will be handled. Closing costs can range into the thousands of dollars, so you want to figure them into your home purchase plan.

Get Information on Federal Assistance

The VA Home Loan program offers military staffers additional help in accessing loans and getting qualified for mortgages. Knowing about the programs available to you may help you put together a better plan to buy your first home or an additional piece of real estate. Debt.org has a variety of management and settlement plans available as well to help veterans trying to reduce debt and purchase a home.