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Thread: Considering BAH when purchasing a home

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    #1

    Question Considering BAH when purchasing a home

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    Would you consider BAH when purchasing a home or just base pay? My husband and I are looking to purchase a home and his gross base pay is $3600/month. BAH for the area we will be PCSing to is $1480. I'm not sure what our mortgage cap should be based on; base only or base + BAH. Based on information that I have received from residents and realtors in the area property taxes and insurance tack on about an extra $300 - $500/month. Currently I do not have employment lined up so we are basing our expenses on his income alone. Any money I bring in will just be gravy.
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    #2
    we took the BAH into consideration- and so will the loan company.

    our BAH was 1478 our mortgage insurace and taxes 1435. we pay utilities out of pocket.
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    #3
    what gunsgirl said! Our mortgage is 1309( that includes insurance, taxes whatever) and our BAH just coveres that. Other utilities like she said is paid out of pocket.
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    Ok. He didn't want to and I was just trying to make sure I wasn't setting us up for something we couldn't handle. Have you ever heard of someone being denied BAH, because he mentioned that it's not a guarantee?
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    #5
    Quote Originally Posted by AFWifey24 View Post
    Have you ever heard of someone being denied BAH, because he mentioned that it's not a guarantee?
    Nope, never heard of being denied BAH. You have to be provided either BAH/OHA or housing.
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    #6
    We used BAH too- out mortgage is 200 less than our BAH so we pay SOME utilities with that left over money, and the rest from the regular pay.
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    #7
    Rarely, you can be required to live on base, in which case you would not receive BAH. This is rare for married couples, but isn't unheard of. More common to happen when a soldier's financial troubles in his personal life start to affect his professional career. You usually will know this is coming though. Can't think of another time I have heard this happen.
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    #8
    Thanks for the information. Our finances are in the best shape ever so I don't see that happening. Now we just need to decided how much "house" we can afford.
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    #9
    A good general guideline as you figure out the top end how much house you can afford is to keep your housing ratio under 28%. So, with income of roughly $5,000 this would mean total payment, including taxes and insurance, of less than $1,400.

    In today's interest rate environment, that would equate to around a $150,000 house. With as many horror stories as I've heard over the last few years with folks being unable to unload their house when they get PCS orders, I would err towards the conservative(less expensive) and remember, just because someone will lend you the money doesn't mean you should borrow it!
    J.J. Montanaro is a CERTIFIED FINANCIAL PLANNER practicioner with USAA Financial Planning Services one of the USAA family of companies.

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