The Veterans Administration and a number of private organizations offer grants to qualified veterans seeking to purchase a home. Most of these organizations provide support that ranges from helping find a potential purchase all the way through closing. The combination of federal and private-sector agencies working to provide assistance to active duty and former military personnel can be a huge help when buying a home.
The Dream Makers Grant for Down Payments and Closing Costs
Offered through the Pentagon Federal Credit Union Foundation, the Dream Makers Grant is a three-to-one match of funds offered up by the veteran for either a down payment or the payment on closing costs when buying a home. Buyers must offer at least $500, and the Dream Makers Program will triple the offer up to $5,000.
The veteran may make no more than $55,000 or 80 percent of the area median income, whichever is greater. The grant is available to veterans who are first-time home buyers, to those who have not owned a home for at least three years, and to those who have lost a home due to divorce or disaster.
The combination of the veteran's funds and the grant when combined must make up at least 3 percent of the overall purchase price.
Military Housing Assistance Fund Gifts for Closing Costs
Though the price of the house is restricted to the price level set by the Veteran's Administration for the area in which the house is located, the funds from the Military Housing Assistance Fund (MHAF) cover just about all closing costs. Lenders may utilize not just salary but also a soldier's basic allowance for housing and basic allowance for subsistence when calculating total salary during evaluation of the application. There is no match for this grant.
The VA Specially Adapted Housing Grant
For veterans requiring special facilities to accommodate disabilities, the purchase of land and construction of a new home or for the purposes of renovating an existing home -- even if the home is still under construction -- the VA offers a grant of up to 50 percent of the total home value. The grant is fairly liberal on what it covers, but it does have a maximum of about $64,000, subject to increases based on annual evaluations. In the case of a veteran with disabilities buying an $80,000 home, for example, the maximum allowable first-time grant would be $40,000. However, this grant can be utilized three times during the life of the veteran, up to the maximum amount. Extending the example, the same veteran could apply for an additional grant of up to $24,000 -- the remaining balance of the maximum amount -- for additional improvements/construction on the house.
Local and State Grants
Searching state by state may reveal more grants open to all home buyers, veterans included. For example, in Georgia, state-supported down payment assistance is available in the form of a zero-percent interest loan of up to $5,000 that isn't repaid until the house is sold, re-financed or transferred. That amount rises to $7,500 for loan applicants who are considered "protectors," which includes military, fire and police personnel.
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