For veterans, finding affordable housing can be challenging. In many areas of the country, particularly large cities, housing is very expensive — and rising each year. In other areas, housing is hard to find.
The good news, though, is the government, banks and other mortgage lenders often have programs specifically for veterans to make housing more affordable.
Here are seven tips to make a search for good affordable housing easier.
Check Out Programs for Renters
First, if your income is low for the area you live in, there are some government programs designed to help low-income people find rentals. You’ve served your country honorably, so government programs to help in a housing crunch are similar to your grandparents using the GI Bill to enter college.
These programs are available through the U.S. Department of Housing and Urban Development, also called HUD. There are three types:
- Privately owned housing that receives subsidies from the government
- A voucher program, where you find a rental and pay via voucher
- Public housing for low-income or disabled citizens, which is owned by the government
In addition, individual states have Housing Finance Agencies that may provide housing assistance and are worth looking into.
Get a Mortgage Through the Veterans Administration Loan Programs
The Veterans Administration (VA) has a number of housing programs to help veterans, service members and surviving spouses buy a home. The VA does not itself make the mortgage loan. Banks, credit unions or other lenders do. However, the VA guarantees part of it for veterans. As a result, the terms can be better. Veterans may be able to get a lower interest rate, or lower or no down payment.
Looking for a lender that offers VA loans is definitely a smart thing to do. To qualify for a VA loan, you will need:
- A satisfactory consumer credit history
- Sufficient income to meet monthly payments
- A valid Certificate of Eligibility (COE), which confirms you are eligible for a VA-backed loan and is given to the lender
Build a Home Using a VA New Construction Loan
VA programs are available for new home construction. You get a loan for new construction from a VA-approved lender. Like home mortgages, the VA guarantees part of the loan for veterans.
It is advisable to shop around for one that is an initial short-term loan for the construction and converts into a long-term mortgage once the construction is done.
These sometimes don’t require a down payment, so the upfront price would be cheaper than a mortgage that does require one. You will need the same qualifications as for a mortgage loan: proof of income to make the payments and a good credit history.
It might take considerable research and talking to lenders to find one that makes these kind of loans, because they became reluctant after the 2008 housing collapse to offer them. However, they can be found. The more you talk to, the better your odds of finding one. Don’t stop at just one or two!
There are two methods of building a newly constructed home: using a local homebuilder or doing the work yourself.
Use a Homebuilder
Because it can be difficult to find a lender willing to write a home construction loan for an individual, one route is to use a homebuilder or contractor to build a home for you.
You shop around for these just as you do for a bank or credit union. Builders eligible to work with a VA construction loan need a valid VA builder ID and a VA appraisal. The VA also places stipulations on builders it works with. The builder must guarantee the home for one year, for example.
Build a Home Yourself
If you like to work on construction projects and would get a sense of fulfillment from building your own home, the second option is to build it yourself. Many people get satisfaction and purpose from building their homes brick by brick and beam by beam.
It is crucial to find a loan that will convert a short-term construction loan into a long-term mortgage. This requires some shopping around, just as it does if you use a builder.
Some communities have developed programs in which veterans build their own houses, spurred by the consequences of high housing costs. In some countries, steep rents and inadequate veteran services have combined to make many veterans homeless. In the United Kingdom, for example, 10 percent of the homeless population is veterans — and as high as 25 percent in some cities.
Because communities increasingly recognize veterans need help with housing, it is worth checking out your state and city to see if they have programs for veterans to build their own homes or financial assistance if you build.
Build an Addition to an Existing House
If you already have a home but it’s become too small for your family or you want to move in with a partner but the home is too small, you can get a loan for an addition to a house from the U.S. government. They are called home improvement loans.
Note that these are not specifically for veterans, but for people whose income qualifies them or for the disabled.
Obtain a Loan for Disabled People
If you have a disability, you may be eligible for assistance or programs from the U.S. Rehabilitation Services Administration.
While finding affordable housing might be tough, there are also multiple ways to help. Check out these programs and services designed to give veterans a home in their communities.
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