Owning a home is a quintessential part of the American Dream. The VA Home Loan program makes it possible for our American Heroes to take advantage of this American Dream. Buying a home is a very exciting time for a military family but it is also risky. Here are some guidelines to follow to assure that buying a home will stay an American Dream and not become an American Nightmare.
All military families know that moving is always on the horizon. Even the best laid plans of staying in an area for 8 years can change if Uncle Sam delivers orders to a new location. Keeping that in mind military families need to be aware of the resale value of their home. If they decide to buy a home that needs renovations they should consider what the resale value will be of the home after the renovations. While doing renovations they should consider their return on investment and not customize the home so much that it would alienate buyers.
Some things to look at when buying the home is what type of neighborhood it is in. Is it conveniently located? Do the neighbors have pride in ownership and take care of their home? These things can strongly affect the resale value when it is time to sell the home.
Another factor military families should keep in mind while buying a home is the rental market in the area. If the family gets transferred and decides to rent out their home they want the property to be located in a strong rental market. While looking for a home find out what rental prices are in the area. Research if the rental market is strong and what type of renters are typically in the area. Don’t forget to figure in the cost of using a property management company to handle the rental, especially if you are moving far from the home.
It goes without saying that a school system is often the first thing buyers consider when purchasing a home. Being located within a good school district can be the factor that gets someone to commit to buying or renting a house. Before buying a home research what the desirable school district is in the region and try to focus your home search within that area. Buying in a premium school district can allow you to sell your rent your home much quicker.
Mortgage Emergency Savings
As any military family knows, you can be uprooted and move at anytime. Therefore to protect themselves and their investment it is wise to have an emergency mortgage account. A good recommendation is to have 6 months of mortgage payments in a separate account that is allocated strictly for paying the mortgage in the event of a transfer. If a military family needs to move very suddenly or is having a hard time selling or renting the home, this account will cover an extra 6 months of mortgage payments while trying to find someone to move in.
Buying a home is a part of the American Dream that every military family deserves. Military families should enjoy the process of buying a home, but should keep in mind the risks they are taking on by doing so. If they keep the four factors of resale value, rental market, school systems, and emergency mortgage savings in mind, they should have peace of mind that their biggest financial investment will be protected.