Why VA is the strongest loan in America
For eligible active-duty, reserves, National Guard, and veterans, the VA loan offers:
- 0% down with full entitlement — no cap in most cases
- No monthly mortgage insurance (saves $150–$500/month vs. FHA or conventional)
- Most forgiving DTI — approvals to 60%+ with strong residual income
- Assumable — if rates rise, you can transfer your loan to a qualified buyer
- No prepayment penalty, streamlined refinance (IRRRL) available anytime
The only cost: a one-time funding fee (1.25%–3.3% financed into the loan), waived entirely for veterans with a service-connected disability rating.
BAH, base pay, and special allowances
Basic Allowance for Housing (BAH) counts as tax-free income — grossed up 125% for qualifying. This is often the difference between qualifying and not.
Other income sources counted: - Base pay with LES showing rank + years of service - BAS (subsistence) — grossed up 125% - Special/hazard/flight pay — if 12+ months history and expected to continue - Deployment pay — case-by-case, usually needs 12-month history
PCS and buying near a new duty station
PCS orders let you close on a home at your new duty station before your first day of pay there. Lenders will use your new BAH rate for the destination station once orders are cut.
If you're within 60 days of PCS to a new location, you can close using a signed LES + orders. Some lenders require a lease-break letter or plan for the current home (rent, sell, or leave vacant with reserves).
Is this path right for you?
Frequently asked questions
Does BAH count as income for a VA loan?
Yes, and it's grossed up 125% because it's tax-free. This significantly boosts qualifying income.
How do I get my Certificate of Eligibility?
Your lender can pull it electronically through VA in minutes. Or request via eBenefits with your DD-214 (if separated) or statement of service (if active).
Can I use VA more than once?
Yes — VA entitlement is reusable. You can restore full entitlement after selling and paying off a prior VA loan, or use second-tier entitlement to hold two VA loans at once.
Is the funding fee waived for disabled veterans?
Yes — 100% waived at any service-connected disability rating (even 10%). Surviving spouses receiving DIC also qualify.
Related guides
- The Complete First-Time Homebuyer's Readiness Guide
- How much home you can actually afford
- Pre-approval checklist
- Back to the Knowledge Base
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