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Saluting first-time homebuyers: 5 Benefits that serve you on the path to homeownership

If you’re considering buying a home for the first time, make sure you take advantage of all the benefits offered to you as a military first-time home buyer.
Father and son lifting moving boxes at new home. (Getty Images)

Purchasing a home for the first time is a significant milestone, and in this economy, it can be daunting. However, fear not military first-time buyers – there is help! If you are racking your brain trying to figure out how to buy your first home, there are several unique benefits and opportunities that can make this dream more attainable for those who have served or are currently serving. From specialized loan programs to financial assistance and protections, the support offered to military personnel can play a vital role in helping you achieve homeownership.

Here are just a few benefits you should make sure to take advantage of:

1. VA Loan Program:

One of the most valuable benefits for first-time military homebuyers is the VA Loan program. There is a lot to cover, so we are going to camp out here for a little bit. While the exact number is unknown, it is estimated that less than 12% of approximately 24 million veterans currently use their VA Loan benefits. While there are qualifying criteria, it might be that many service members are unaware this benefit is available. Let’s break it down.

  • Loan Administrator—The VA Loan is administered by the Department of Veterans Affairs (VA) and provides a range of advantages that sets it apart from conventional mortgages. A big point to note is that VA loans often do not require a down payment, making homeownership more accessible for eligible borrowers. They also have competitive interest rates and no private mortgage insurance (PMI), saving more money in the long run. These features make homeownership more accessible, allowing military homebuyers to conserve their hard-earned savings while still securing a mortgage.
  • Safeguards—The VA’s backing of these loans plays a vital role in making homeownership more accessible for military personnel by reducing the financial barriers typically associated with traditional mortgage loans. However, it’s important to note that the while the VA administers the criteria for the loan, it does not directly lend money to borrowers. Instead, it establishes the guidelines and regulations that lenders must follow to participate in the VA loan program. So, while the loans themselves are originated and serviced by approved lenders like banks, credit unions, and mortgage companies, the VA’s backing provides added security and benefits for both lenders and borrowers. Consequently, it is important to borrow from a lender you trust, like Navy Federal Credit Union.
  • Flexibility—VA loans have more flexible qualifying criteria, taking into account factors such as credit history and debt-to-income ratio. This flexibility can be particularly beneficial for first-time buyers who may have limited credit history or other financial constraints. Additionally, the VA loan program provides support and guidance through its network of approved lenders, like Navy Federal, and offers options for refinancing and streamlining the loan process.
  • Military Friendly—What is nice about working with military credit unions, such as Navy Federal, is that they understand what it is like being in the military, and their mortgage programs are specifically designed to accommodate the unique circumstances of military life, such as frequent relocations. They offer features like no-fee mortgage rate locks, allowing homebuyers to secure a favorable interest rate while navigating the challenges of a PCS or deployment.

2. Assistance with Closing Costs:

This is another big one to make sure you aren’t leaving money on the table. Some programs and organizations provide financial assistance to military homebuyers to help cover the closing costs associated with purchasing a home. These programs can help alleviate the financial burden of upfront expenses. This is also an area where Navy Federal is a great resource. They understand closing costs can be a significant financial hurdle for first-time military homebuyers. To alleviate this burden, they offer assistance programs designed to help cover these expenses. These programs can provide grants or loans that reduce the out-of-pocket costs associated with closing, allowing military homebuyers to preserve their savings or allocate funds toward other important needs.

3. Homebuyer Education and Counseling:

We realize this might be a lot and it may feel like drinking water from a firehose. But the good news is that you are not alone when it comes to navigating the sometimes murky waters of first-time homeownership. Many military support organizations provide educational resources and counseling services to assist first-time homebuyers.

Are you still not sure where to find the Yoda to your Luke or the Hagrid to your Harry? Navy Federal Credit Union provides personalized guidance through its team of experienced mortgage professionals who are well-versed in the unique needs of military personnel. These experts can offer tailored advice, answer questions, and ensure that first-time military homebuyers have a trusted partner by their side throughout the entire home-buying journey.

These resources can help individuals understand the home buying process, budgeting, credit management, and other important aspects of homeownership. Their experienced mortgage professionals understand VA Loan requirements and can help borrowers and learn their options, answer questions, and navigate the complexities of the loan process.

4. Protections under the Servicemembers Civil Relief Act (SCRA):

First-time military homebuyers are afforded specific legal protections through the Servicemembers Civil Relief Act (SCRA). This legislation offers safeguards to military personnel, including benefits related to housing.

Under the SCRA, military homebuyers are protected against foreclosure and eviction while serving on active duty. This provision offers peace of mind, ensuring that military members can focus on their duties without concerns about their housing situation. Furthermore, the SCRA allows servicemembers to terminate housing leases early if they receive deployment orders or experience a permanent change of station (PCS) that makes the lease burdensome.

These legal protections help first-time military homebuyers maintain stability and mitigate potential challenges that may arise due to their military service.

5. Potential Tax Benefits:

Ah yes. Taxes. What if we told you buying a home might actually help you when it comes to those? Military homebuyers may be eligible for certain tax benefits related to homeownership. These benefits can include deductions for mortgage interest, property taxes, and certain home improvements. It’s advisable to consult with a tax professional to understand the specific tax advantages available.

It’s also important to note that tax laws and regulations can change, and eligibility for tax benefits may vary based on individual circumstances. It’s recommended that military homebuyers consult with a tax professional or utilize tax software to ensure they take advantage of all available tax benefits and credits.

When shopping for a new house, make sure you take advantage of all the benefits offered to you as a military first-time home buyer. Do your homework and go with a lender that understands military life, like Navy Federal Credit Union. By easing the financial strain of closing costs, Navy Federal enables first-time military homebuyers to achieve homeownership more comfortably, providing them with a solid foundation for their new journey.

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