Sean Murphy/Getty Images
The Department of Veterans Affairs (VA) has several ways it helps veterans, service members and eligible surviving spouses like you become homeowners.
Home Loan Guaranty Program: Under this program, the VA will guaranty a portion of your home loan to protect lenders against loss if you cannot repay. This benefit can be used for purchasing, building and improving your home; to refinance an existing loan that is not guaranteed by the VA; or to get a lower interest rate on an existing VA-guaranteed loan. Private banks and mortgage companies provide the loans in this program, but having a VA guaranty often can get you better financial terms like lower interest rates and closing costs, or help you avoid making a down payment.
The VA offers three types of loans in this program:
- The Purchase Loan can help you buy a home at a competitive interest rate, generally without the need to buy mortgage insurance or make a down payment.
- The Streamline Refinance Loan — also referred to as the Interest Rate Reduction Refinance Loan (IRRRL) — can get you a lower interest rate by refinancing your existing VA loan.
- The Cash-Out Refinance Loan can help you use your home equity to pay off other debt, pay for school tuition, make improvements to your home or refinance a non-VA loan into a VA loan.
Adaptive Housing Grants: If you have certain types of service-connected physical disabilities, you may be eligible for grant funds to help buy or remodel a home to fit your needs. The VA offers three types of housing grants, each with its own eligibility requirements:
- The Specially Adapted Housing (SAH) Grant is available to veterans and service members with specific service-connected disabilities, such as amputations, blindness, severe burns or respiratory injuries. The grant has a current maximum of $77,307.
- The Special Housing Adaptation (SHA) Grant is similar to the SAH grant and can be used by disabled veterans and service members who have experienced injuries such as blindness, the loss of a hand or hands or severe burns. The grant has a current maximum of $15,462.
- The Temporary Residence Assistance (TRA) Grant may be available to SAH/SHA-eligible veterans and service members who are temporarily residing in a home owned by a family member. Under this grant, SAH grant recipients can receive up to $33,937 and SHA grant recipients can receive up to $6,059.
Veterans’ Mortgage Life Insurance (VMLI): If you are a severely disabled veteran, you may also be eligible for VMLI, which is mortgage-protection insurance that can assist your family in paying off a home mortgage in the event of your death. This program is available to you only if you are a severely disabled veteran who has received an SAH grant, and you must have the title to the home and a mortgage on the home. You must apply for this protection before your 70th birthday.
HUD-VASH Vouchers: The VA and the Department of Housing and Urban Development (HUD) offer assistance to homeless veterans through the HUD-VA Supportive Housing (HUD-VASH) program. It combines HUD’s Housing Choice Vouchers (HCV) rental assistance — a benefit that gives assistance to very low-income families and individuals — with VA-provided case management and clinical services. If you are or know a homeless veteran who can benefit from this assistance, visit HUD’s website for more information.