VA Loan Tips for Disabled Veterans

27 Apr VA Loan Tips for Disabled Veterans

Disabled veterans are given special considerations when they apply for a VA loan? Today we will discuss additional benefits and VA loan tips available to you based on your disability status that can help you save more.

The VA Loan Funding Fee Is Waived

If you are eligible for disability benefits and you have yet not closed on your VA loan, you will not need to pay your funding fee. It will be waived. If you have already closed on your loan before receiving benefits, you may be entitled to a refund. For example, if a first-time home-buyer is buying a $200,000 home with a VA loan and is eligible for disability benefits, the 2.15% funding fee will be waived – saving the homeowner $4,300. Once your disability benefits are accepted, you need to apply in writing to your state’s VA Regional Loan Center to receive the funding fee refund. If you financed the funding fee, the refund amount would be deducted from your principal amount due, and in case you paid with cash, the VA will issue you a check.

It is essential to remember that if currently, you do not receive disability benefits, you should have a disability claim pending before the closing date of the loan. If your application for disability is dated after your closing date, you may not receive a refund. 

Specially Adapted Housing Grants Are Available

Disabled veterans also need accessibility modifications. The Specially Adapted Housing (SAH) grant and the Special Housing Adaptation (SHA) grant offer help in such cases. 

The SAH assists qualified veterans with one of the following:

• Construct a home with special disability-related modifications.
• Modify an existing property to satisfy adapted housing needs.
• Apply the grant against the principal mortgage balance of a modified home that’s already been acquired without VA grant assistance.

The SHA assists qualified veterans with one of the following: 

• Adapt an existing home that is previously owned by the veteran.
• Adapt a house that the veteran intends to purchase.
• Help a veteran purchase a home that has already been adapted.

Please note that if you are contemplating a grant, the maximum amount permitted for the SAH is $90,364. For the SHA, the maximum amount per year is $18,074. Also, veterans should have their disability benefits approved before applying for housing grants. 

See if you’re eligible for a $0 Down VA Loan.

Tax Credits and Exemptions with Homeownership

After you have purchased your new home using VA loan benefits, you also get qualified for tax credits and exemptions. The Disabled Veterans Property Tax Exemption can help lessen the amount a disabled veteran pays per year in taxes. The amount differs by state, so it’s necessary to check with your local VA office to know about your state-specific benefit. Or you can check online at the VA’s eBenefits portal “Benefits by State.” For example, a few states allow a 100% tax exemption to all veterans, while others only offer it to 100% disabled veterans. 

With a VA loan, you may also be suitable for a Mortgage Credit Certificate (MCC). The MCC is declared on the state level that entitles you to claim a tax credit for a portion of the mortgage interest paid per tax year. The credit amount is decided on the state level but is a benefit worth taking advantage of.

Disability Payments Can Help You Get a VA Loan

If you are on VA disability compensation, it can be calculated as income, which, in turn, makes you eligible for VA loan income requirements. To qualify for a VA loan, income must meet three standards – it must be stable, reliable, and expected to continue. The critical factor in using disability pension toward a VA loan is that your payments are likely to continue. 

Read above VA loan tips in order to maximize your VA home loan benefits and save your time.