Getting a VA Home Loan While Still Serving in the Military

It's not uncommon for service members to think they have to wait until they've separated from the military to pursue a VA home loan. But that's absolutely, unequivocally untrue.

When it comes to eligibility for a VA mortgage, it isn't something that takes years and years to accrue. Generally, you're eligible if you've served at least 90 consecutive days on active duty during wartime or 181 days during peacetime.

To be sure, meeting the eligibility requirements is just the first step. There are still credit, income and other financial guidelines to clear. Current service members can also run into challenges regarding occupancy and the VA's focus on primary residences.

But the bottom line remains the same: You can use the VA loan program to buy a home while you're still serving. Let's take a closer look.

Income & BAH

Active military members will still need to meet VA and lender guidelines for credit score, debt-to-income ratio, residual income and more. Some good news: As long as you're not set to ETS within 12 months of your loan closing, there isn't usually much room for concern about your employment.

Lenders will obtain a copy of your Leave and Earnings Statement (LES) to get a better handle on your income. You may also be able to count some military allowances and special pay, such as flight pay, hazard pay and combat pay. On top of that, eligible service members can also count their Basic Allowance for Housing toward qualifying for a VA mortgage.

BAH rates vary based on several factors, including your service history, family size and location. They're also subject to change annually. For example, the 2017 BAH rate for an E-4 with dependents in Fort Campbell, Ky., is $1,254 per month (and $1,035 for an E-4 without dependents). Shift the location to Fort Belvoir, just outside Washington, D.C., and those rates jump to $2,124 and $1,650, respectively.

Occupancy Requirements

The VA loan program is focused on helping veterans and service members purchase homes they will live in year round as their primary residence. These aren't for buying vacation homes, investment properties or other income-producing ventures. As part of that focus, the VA typically wants you living in the home full time within 60 days of closing.

That can obviously prove challenging for some service members, especially those on deployment. There are exceptions to the occupancy requirement, the most common being that a spouse can fulfill it on your behalf. As a general example, an active duty borrower stationed in California could seek a VA loan to purchase a home in Florida, provided in part that his or her spouse can fulfill the occupancy requirement.

In those cases, lenders would likely take the service member's own living and travel expenses into account when evaluating what they can afford.

Power of Attorney

Depending on their situation, current service members may also need to utilize Power of Attorney during the mortgage process. There are two basic types, general and specific. Figuring out what you need depends in part on what documents the service member is able to sign and when.

Some might start the homebuying journey before a deployment, while others decide to move forward despite being hundreds or thousands of miles apart. A loan specialist will walk you through what type of Power of Attorney documents you need.

Remember, the VA loan program isn't a benefit open only to those no longer serving. Tens of thousands of service personnel utilize their hard-earned home loan benefits each year.