Table of Contents
Disability compensation is a tax-free monetary benefit paid to Veterans with disabilities that are the result of a disease or injury incurred or aggravated during active military service. The benefits amount is graduated according to the degree of the Veteran’s disability on a scale from 10 percent to 100 percent (in increments of 10 percent). Compensation may also be paid for disabilities that are considered related or secondary to disabilities occurring in service and for disabilities presumed to be related to circumstances of military service, even though they may arise after service. To be eligible for compensation, the Veteran must have been separated or discharged under conditions other than dishonorable. Monthly disability compensation varies with the degree of disability and the number of eligible dependents. Veterans with disability ratings of at least 30 percent are eligible for additional allowances for dependents, including spouses, minor children, children who are permanently incapable of self-support because of a disability arising before age 18, and dependent parents. The additional amount depends on the disability rating and the number of dependents. For detailed 2016 compensation rate information visit: http://www.benefits.va.gov/COMPENSATION/resources_comp02.asp
The payment of military retirement pay, disability severance pay and separation incentive payments, known as Special Separation Benefit (SSB) and Reservists’ Involuntary Separation Pay (RISP), and Voluntary Separation (VSP), may affect the amount of VA compensation paid to disabled Veterans. For additional details on types of disability claims and how to apply, visit: http://benefits.va.gov/benefits/.
Special Monthly Compensation (SMC)
SMC is an additional tax-free benefit that can be paid to Veterans as well as their spouses, surviving spouses, and parents. For Veterans, SMC is a higher rate of compensation paid, due to special circumstances such as the need for aid and attendance by another person, or due to a specific disability such as the loss of use of one hand or leg. A Veteran who is determined by VA to be in need of the regular aid and attendance of another person, or a Veteran who is permanently housebound, may be entitled to additional payments. For detailed 2016 special monthly compensation rate information visit: http://www.benefits.va.gov/COMPENSATION/resources_comp02.asp
Allowance For Aid And Attendance Or Housebound Veterans
Veterans determined by VA to be in need of the regular aid and attendance of another person, or permanently housebound, may be entitled to additional disability compensation or pension payments. A Veteran evaluated at 30 percent or more disabled is entitled to receive an additional payment for a spouse who is in need of the aid and attendance of another person. Additional information may be found at http://www.benefits.va.gov/pension/aid_attendance-house-bound.asp.
As of October 1, 2016, Veterans and service members may be eligible for a one-time payment of not more than $20, 235.20 toward the purchase of an automobile or other conveyance if they have service-connected loss or permanent loss of use of one or both hands or feet, or permanent impairment of vision of both eyes to a certain degree. To apply, contact a VA regional office at 1-800-827-1000 or the nearest VA health care facility, which may be located at http://www.va.gov/directory/guide/division.asp?dnum=1
Any Veteran who has service-connected disabilities that require prosthetic or orthopedic appliances may receive clothing allowances. This allowance is also available to any Veteran whose service-connected skin condition requires prescribed medication that irreparably damages outer garments. To apply, contact the prosthetic representative at the nearest VA medical center located at: https://www.va.gov/directory/guide/division.asp?dnum=1&isFlash=0
For information on current rates visit: http://www.benefits.va.gov/compensation/special_Benefit_Allowances_2017.asp
Additional Benefits For Eligible Military Retirees
Concurrent Retirement and Disability Pay (CRDP) is a DoD program that allows some individuals to receive both military retired pay and VA disability compensation. Normally, such concurrent receipt is prohibited. Veterans do not need to apply for this benefit, as payment is coordinated between VA and the military pay center. To qualify for CRDP, Veterans must have a VA service-connected disability rating 50 percent or greater, be eligible to receive retired pay, and:
Retire from military service based on longevity, including Temporary Early Retirement Authority (TERA) retirees;
or Retire due to disability with 20 or more years of service;
or Retire National Guard or Reserve service with 20 or more qualifying years.
- For Veterans who retired due to disability with 20 or more years of service. CRDP is subject to an offset for the difference between retired pay based on disability and retired pay based on longevity.
Housing Grants For Disabled Veterans
Service members and Veterans with certain service-connected disabilities may be, entitled to a housing grant from VA to help build a new specialty adapted house, to adapt a home they already own or buy a house and modify it to meet their disability-related requirements. Eligible Veterans or service members may now receive up to three uses of the grant, with the total dollar amount of the grants not to exceed the maximum allowable. Housing grant amounts may be adjusted October 1 every-year based on a cost-of construction index. These adjustments will increase the grants amounts or leave them unchanged: grant amounts will not decrease. Previous grant recipients who had received assistance of less than the current maximum allowable may be eligible for an additional grant usage. To obtain general information about the Specialty Adapted Housing program, visit: www.benefits.va.gov/homeloans/adaptedhousing.asp, or call the program’s local office of jurisdiction at 1-877-827-3702.
Specialty Adapted Housing (SAH) Grant
VA may approve a grant of not more than 50 percent of the cost of building, buying, or adapting existing homes or paying to reduce indebtedness on a currently owned home that is being adapted, up to a maximum benefit amount of $77,307. In certain instances, the full grant amount may be applied toward remodeling costs. The SAH grant is available to certain Veterans and service members who are entitled to disability compensation due to the following:
- Load or loss of use of both lower extremities, which so affects the functions of balance or propulsion to preclude ambulating without the aid of braces, canes or a wheelchair.
- Loss or loss of use of both upper extremities at or above the elbow.
- Blindness in both eyes, having only light perception, plus loss or loss of use of one lower extremity.
- Loss or loss of use of one lower extremity together with (a) residuals of organic disease or injury, or (b) the loss or loss of use of one upper extremity which so affects the functions of balance braces, canes, crutches or a wheelchair.
- Severe burn injuries, which are defined as full thickness or subdermal burns that have resulted in contractures with limitation of motion of two or more extremities or of at least one extremity and the trunk.
- The loss or loss of use of one or more lower extremities due to service on or after September 11, 2001, which so affects the functions of balance or propulsion as to preclude ambulating without the aid of braces, crutches, canes, or a wheelchair.
NOTE: The property may be located outside the United States, in a country or political subdivision which allows individuals to have or acquire a beneficial propert interest, and in which the Secretary of Veteran Affairs, in his or her discretion, has determined that is reasonably practicable to provide assistance in acquiring specially adapted housing. For more information on SAH, visit: http://www.benefits.va.gov/homeloans/adaptedhousing.asp or call the program’s local office of jurisdiction at 1-877-827-3702.
Special Home Adaption (SHA) Grant
VA may approve a benefit amount up to a maximum of $15,462 for the cost of necessary adaptations to a Service member’s or Veteran’s residence or to help him/her acquire a residence already adapted with special features for his/her disability, to purchase and adapt a home, or for adaptations to a family member’s home in which they will reside. To be eligible for this grant, service members and Veterans must be entitled to compensation for permanent and total service-connected disability due to one of the following:
- Blindness in both eyes with 20/200 acuity or less.
- Anatomical loss or loss of use of both hands.
- Severe burn injuries (see above).
- Certain severe respiratory injuries.
Temproray Residence Adaptation (TRA)
Eligible Veterans and service members who are temporarily residing in a home owned by a family member may also receive a TRA grant to help the Veteran or Service member adapt the family member’s home to meet his or her special needs. Those eligible for a $77,307, grant would be permitted to use up to $33,937, and those eligible for a $15,462 grant would be permitted to use up to $6,059. Under the Honoring America’s Veterans and Caring for Camp LeJeune Families Act of 2012. TRA grant amounts do not count against SAM or SHA grant maximum amounts, starting August 6, 2013. Grant amounts are adjusted annually October 1 based on a cost-of-construction index.
Veterans and service members with available VA Home Loan Guaranty entitlement may also obtain a guaranteed loan to supplement the grant to acquire a specialty adapted home. For more information on SAH, visit: http://www.benefits.va.gov/homeloans/sah.asp
Vocational Rehabilitation And Employment (VR&E)
VR&E, also referred to as the Chapter 31 program, provides services to eligible service members and Veterans with service-connected disabilities and an employment handicap to help them to prepare for, obtain and maintain suitable employment. For Veterans and service members with service-connected disabilities so severe to improve their ability to live independently as possible. For additional information on VR&E benefits please visit: http://benefits.va.gov//vocrehab/index.asp
VR&E Eligibility For Veterans
A Veteran must have a VA service-connected disability rating of at least 20 percent and determined with an employment handicap and must be discharged or released from active military service under other than dishonorable conditions.
Veteran Eligibility For Service Members
Service members are eligible to apply if they expect to receive an honorable discharge upon separation from active duty, obtain a memorandum rating of 20 percent or more from VA, obtain a proposed Disability Evaluation System (DES) rating of 20 percent or more from VA, or obtain a referral to a Physical Evaluation Board (PEB) through the integrated Disability Evaluation System (IDES).
A Vocational Rehabilitation Counselor (VRC) works with the Veteran to determine if an employment handicap exists. An employment handicap exists if a Veteran’s service-connected disability impairs his/her ability to prepare for, obtain, and maintain suitable employment. After an entitlement decision is made, the Veteran and VRC work together to develop an individualized rehabilitation plan. The individualized rehabilitation plan outlines the necessary rehabilitation services to be provided to the Veteran.
Veterans work with a VRC to select one of the Five Tracks to employment based on their individualized needs. The Five Tracks to Employment provide greater emphasis on exploring employment options early in the rehabilitation planning process, better informed choices for the Veteran regarding occupational and employment options, faster access to employment for Veterans who have identifiable and transferable skills for direct placement into suitable employment and an option for Veterans who are not able to work, but need assistance to lead a more independent life, if a program of training is selected, VA pays the cost of the approved training and services (except those coordinated through other providers) that are outlined in the Veteran’s rehabilitation plan, including substance allowance.
The Five Tracks To Employment Are
Reemployment with previous employer. Rapid access to employment Self-employment, Employment through long-term services and independent living services.
Period Of A Rehabilitation Program
The basic period of eligibility in which VR&E benefits may be used is 12 years from the latter of the following:
- A Veteran’s date of separation from active military service, or
- The date VA first notified a Veteran that he/she has been granted a compensable service-connected disability. Veterans may be provided up to 48 months of full-time services or the past-time equivalent based on the extent of services needed to complete the rehabilitation program. Rehabilitation plans that only provide services to improve independence in daily living are limited to 30 months, which may be extended in certain circumstances.
In partnership with the Department of Labor VA provides support to Veterans and transitioning service members at all stages of their job search, including career advice, resume building and access to employers who want to hire Veterans and military spouses. Additional information and access to services are available at http://www.vets.gov/employment/
VR&E also establishes partnerships with federal, state and private agencies that help facilitate direct placement of Veterans or service members into civilian careers. VR&E can assist with placement using the following resources
On The Job Training (OJT) Program
Employers hire Veterans at an apprentice wage, and VR&E supplements the salary at the journeyman wage (up to the maximum amount allowable under OJT). As the Veterans programs through training the employers begin to increase the salary until the Veterans reach journeyman level and the employers pay the entire salary. VR&E may also pay for any necessary tools.
Non-Paid Work Experience (NPWE)
The NPWE program provides eligible Veterans the opportunity to obtain training and practical job experience concurrently. This program is ideal for Veterans or service members who have a clearly established vocational goal, and who learn easily in a hands-on environment. This program is also well suited for Veterans who are having difficulties obtaining employment due too lack of work experience. The NPWE program may be established in a federal, state, local (i.e. city, town, school district) government agencies only. The employer may hire the Veteran at any point during the NPWE program.
Special Employer Incentive (SEI)
The SEI program is for eligible Veterans who face challenges in obtaining employment. Veterans approved to participate in the SEI program are hired by participating employers and employment is expected to continue following successful completion of the program. Employers are provided this incentive to hire Veterans. If approved, the employer will receive reimbursement for up to 50 percent of the Veteran’s salary during the SEI program, which can last up to six months.
Vetsuccess On Campus (VSOC)
The VSOC program aims to help Veterans, service members, and eligible dependents succeed through a coordinated delivery of on-campus benefits assistance and counseling, leading to successful completion of their education and preparing them to enter the labor market in viable careers. For additional information on the VSOC program please visit: http://www.benefits.va.gov/vocrehab/vsoc.asp
Chapter 36 Education And Career Counseling
VA’s Education and Career Counseling Program (Title 38 U.S.C. Chapter 36) offers a great opportunity for transitioning Veterans, service members, and dependents to get personalized counseling and support to guide their career paths, ensure the most effective use of their VA benefits, and help them achieve their goals. For additional information please visit: http://www.benefits.va.gov/VOCREHAB/edu_voc_counseling.asp. To apply for this program visit: http://www.vba.va.gov/pubs/forms/VBA-28-8832-ARE.pdf.
In partnership with the Department of Labor, VA provides support to Veterans and transitioning Servicemembers at all stages of their job search, including career advice, resume building and access to employers who want to hire Veterans and military spouses. Additional information and access to services are available at http://www.vets.gov/employment /
VA helps Veterans and their families cope with financial challenges by providing supplemental income through the Veterans Pension and Survivors Pension benefit programs. Payments are made to bring the Veterans or Survivor’s total income, including other retirement or Social Security income, to a level set by Congress. Unreimbursed medical expenses may reduce countable income for VA purposes.
Congress establishes the maximum annual Veterans Pension rates. Payments are reduced by the amount of countable income of the Veteran, spouses, and dependent children.
When a Veteran without a spouse or a child is furnished nursing-home or domiciliary care by VA, the pension is reduced to an amount not to exceed $90 per month after three calendar months of care. The reduction may be delayed if nursing-home care is continued to provide the Veteran with rehabilitation services.
To apply for increased pension based on A&A or Housebound payments, write to the PMC that services your state and provide medical evidence, such as a doctor’s report, that validates the need for an increased benefit. For additional information on pension benefits please visit: http://www.benefits.va.gov/pension/
Eligibility For Veterans Pension
Generally, a Veteran must have at least 90 days of active duty service, with at least one day during a VA recognized wartime period to qualify for a VA pension. The 90-day active service requirement does not apply to Veterans discharged from the military due to a service-connected disability.
Veterans who entered active duty after September 7, 1980, generally must have served at least 24 months of the full period for which called or ordered to active duty (with some exceptions), with at least one day during a war time period. In addition to meeting minimum service requirement, low-income wartime Veterans may qualify for pension if they meet certain service, income and net worth limits set by law and are: Age 65 or older, OR Permanently and totally disabled, OR a patient in a nursing home receiving skilled nursing care, OR Receiving Social Security Disability Insurance, OR Receiving Supplemental Security Income.
Yearly family income must be less than the amount set by Congress to qualify for the Veterans Pension benefit. Payments are made to bring the Veteran’s total income, including other retirement or Social Security income, to a level set by Congress. Unreimbursed medical expenses may reduce countable income for VA purposes.
NOTE: Veterans may have to meet longer minimum periods of active duty if they entered active duty on or after September 8, 1980, or, if they were officers who entered active duty on or after October 16, 1981. The Veteran’s discharge must have been under conditions other than dishonorable and the disability must be for reasons other than the Veteran’s own willful misconduct.
How To Apply For Veterans Pension
To apply for Veterans Pension, download and complete VA FORM 21P 527EZ, “Application for Pension”. You can mail your application to the Pension Management Center (PMC) that serves your state. You may also visit your local regional benefit office and turn in your application for processing. You can locate your local regional benefit on pension benefits please visit: http://www.benefits.va.gov/pension
Aid And Attendance And Housebound Benefits (Specialty Monthly Pension)
Veterans and survivors who are eligible for VA pension and require the aid and attendance of another person, or are housebound, may be eligible for higher maximum pension rate. These benefits paid in addition to monthly pension, and they are not paid without eligibility to pension. Since aid and attendance and housebound allowances increase the pension amount, people who are not eligible for a basic pension due to excessive income may be eligible for pension at these increased rates. A Veteran or surviving spouse may not receive aid and attendance benefits and housebound benefits at the same time. For additional information on aid and attendance and housebound benefits including how to apply please visit: http://www.benefits.va.gov/pension/aid_attendance_housebound.asp.
VA Educational Programs
Education And Training
Post-9/11 GI Bill: The Post-9/11 GI Bill is an education benefit program for service members and Veterans who served on active duty after September 10, 2001. Benefits are payable for training pursued on or after August 1, 2009. No payments can be made under this program for training pursued before that date. For more information on education and training opportunities please visit: http://www.benefits.va.gov/gibill/ or by calling 1-888-GI-Bil-1 (1-888-442-4551)
Post-9/11 Gi Bill Eligibility
To be eligible, the Service member or Veteran must serve at least 90 aggregate days on active duty after September10, 2001, and remain on active duty or be honorably discharged. Active duty includes active service performed by National Guard members under title 32 U.S.C. for the purposes of organizing, administering recruiting, instructing, or training the National Guard; or under section 502(f) for the purpose of responding to a national emergency. Veterans may also be eligible if they were honorably discharged from active duty for a service-connected disability after serving 30 continuous days after September 10, 2001. Generally, service members or Veterans may receive up to 36 months of entitlement under the Post-9/11 GI Bill. Eligibility for benefits expires 15 years from the last period of active duty of at least 90 consecutive days. If released for a service-connected disability after at least 30 days of continuous service, eligibility ends 15 years from when the member is released for the service-connected disability.
If on August 1, 2009, the Service member or Veteran is eligible for the Montgomery GI Bill; the Montgomery GI Bill – Selected Reserve; or the Reserve Educational Assistance Program, and qualifies for the Post-9/11 GI Bill, an irrevocable election must be made to receive benefits under the Post-9/11 GI Bill. In most instances, once the election to receive benefits under the Post-9/11 GI Bill is made, the individual will no longer be eligible to receive benefits under the relinguished program. Based on the length of active duty service, eligible participants are entitled to receive a percentage of the following:
The cost of in-state tuition and fees at public institutions; the tuition and fees are capped at a national maximum rate for those attending private or foreign schools. Current rates can be found at http://www.benefits.va.gov/GIBILL/resources/benefits_resources/rate-tables.asp. Tuition and fees are paid to the institution on the student’s behalf (2016-2017: $21,970.46).
Monthly housing allowance* equal to the basic allowance for housing payable to a military E-5 with dependents, in the same ZIP code as the primary school (paid directly to the Service member, Veteran, or eligible dependents).
Yearly books and supplies stipend of up to $1,000 per year (paid directly to the Service member, Veteran, or eligible dependents), and
A one-time payment of $500 paid to certain individuals relocating from highly rural areas.
*Housing allowance is not payable to individuals pursuing training at half time or less.
Approved training under the Post-9/11 GI Bill includes graduate and undergraduate degrees, vocational/technical training, on-the-job training, flight training, correspondence training, licensing and national testing programs, and tutorial assistance. Individuals serving an aggregate period of active duty after September 10, 2001, can receive the following percentages based on length of service.
|Service Requirements After 9/10/01, an individual must serve an aggregate of:||Payment Tiers Percentage|
|At least 36 months||100 percent|
|At least 30 continuous days on active duty and discharged due to a service-connected disability||100 percent|
|At least 30 months, but less than 36 months||90 percent|
|At least 24 months, but less than 30 months||80 percent|
|*At least 18 months, but less than 24 months||70 percent|
|*At least 12 months, but less than 18 months||60 percent|
|*At least 6 months, but less than 12 months||50 percent|
|*At least 90 days, but less than 6 months||40 percent|
*Excludes time in military training and/or skill training
The Yellow Ribbon G.I. Bill Education Enhancement Program
The Yellow Ribbon Program allows institutions of higher learning (such as colleges, universities, and other degree-granting schools) in the United States to voluntarily enter into an agreement with VA to fund tuition and fees that exceed the amounts payable under the Post-9/11 GI Bill. The institution can contribute a specified dollar amount of those expenses, and VA will match the contribution, not to exceed 50 percent of the difference. To be eligible, the student must be a Veteran receiving benefit at the 100-percent benefit rate, a transfer-of-entitlement-eligible dependent child, or a transfer-of-entitlement-eligible spouse of a Veteran.
Marine Gunnery Sergeant John David Fry Scholarship Eligibility
The Marine Gunnery Sergeant John David Fry Scholarship provides Post-9/11 GI Bill benefits to the children and surviving spouses of service members who died in the line of duty after September 10, 2001. Eligible beneficiaries attending school may receive up to 36 months of benefits at the 100% level.
NOTE: Fry Scholarship beneficiaries are not eligible for Yellow Ribbon Program benefits. The Fry 27 Scholarship includes:
Full tuition and fees paid directly to the school for all public school in-state students. For those attending private or foreign schools, tuition and fees are capped at a statutory maximum amount per academic year: A monthly housing allowance and a books and supplies stipend.
Children of active-duty members of the Armed Forces who died in the line of duty after September 10, 2001, are eligible for this benefit. A child may begin an approved program of education before the age of 18. Eligibility ends on the child’s 33rd birthday. A child’s marital status has no effect on eligibility. Eligible children are entitled to 36 months of benefits at the 100-percent level. Have 15 years to use the benefit beginning on their 18th birthday. May use the benefit until their 33rd birthday. Are not eligible for the Yellow Ribbon Program.
Spouses of active-duty members of the Armed Forces who died in the line of duty after September 10, 2001, are eligible for this benefit. A surviving spouse’s eligibility generally ends 15 years after the Service member’s death. A spouse will lose eligibility for this benefit upon remarriage.
Because certain provisions of the law that extended these benefits to spouses did not go in effect until January 1, 2015, some surviving spouses’ benefits would have expired in 2016.
A new provision of the law signed on December 16, 2016, extends the benefit eligibility to January 1, 2021, for the spouses of service members who died in the line of duty between September 11, 2001, and December 31, 2005. This allows surviving spouses’ additional time to use the Fry Scholarship benefits.
Survivor’s And Dependents’ Educational Assistance (DEA)
Dependents of Veterans who were permanently and totally disabled on active duty or due to a service-related condition may be eligible for 45 months of degree and certificate courses, apprenticeships, and on-the-job training under the Survivor’s and Dependents’ Educational Assistance (DEA) program as follows:
The spouse or child of a Service member or Veteran who either died of a service-connected disability, or who has permanent and total service-connected disability, or who died while such a disability existed. The spouse or child of a Service member listed for more than 90 days as currently Missing in Action (MIA), captured in the line of duty by a hostile force, or detained or interned by a foreign government or power.
The spouse or child of a Service member who is hospitalized or receives outpatient care or treatment for a disability that is determined to be totally and permanently disabling, incurred or aggravated due to active duty, and for the service member is likely to be discharged from military service.
Surviving spouses lose eligibility of they remarry before age 57 or are living with another person who has been recognized publicly as their spouse. They can regain eligibility if their remarriage ends by death or divorce or if they cease living with the person. Dependent children do not lose eligibility if the surviving spouse remarries. Visit www.benefits.va.gov/gibill for more information.
Period Of Eligibility
The period of eligibility for Veteran’s spouses expires 10 years from either the date they become eligible or the date of the Veteran’s death. Children generally must be between the ages of 18 and 26 to receive educational benefits. VA may grant extensions to both spouse and children.
The period of eligibility for spouses of service members who died on active duty expires 20 years from the date of death. This is a change in law that became effective December 10, 2004. Spouses of service members who died on active duty whose 10-year eligibility period expired before December 10, 2004, now have 20 years from the date of death to use educational benefits.
Benefits may be awarded for pursuit of associate, bachelor, or graduate degrees at colleges and universities; independent study; cooperative training; study abroad; certificate or diploma from business, technical, or vocational schools; apprenticeships; on-the-job training programs; farm cooperative courses; and preparatory courses for tests required or used for admission to an institution of higher learning or graduate school.
Benefits for correspondence courses under certain conditions are available to spouses only. Beneficiaries without high-school degrees can pursue secondary schooling, and those with a deficiency in a subject may receive tutorial assistance if enrolled half-time or more.
Dependents over age 14 with physical or mental disabilities that impair their ability to pursue an education may receive specialized vocational or restorative training, including speech and voice correction, language retraining, lip reading, auditory training, Braille reading and writing, and similar programs. Certain disabled or surviving spouses are also eligible.
For additional information on Survivors and Dependents’ Educational Assistance (DEA) visit: http://www.benefits.va.gov/GIBILL/DEA.asp
Montgomery Gi Bill Active Duty (MGIB-AD)
The MGIB-AD (Chapter 30) is an education benefit that provides up to 36 months of education benefits to eligible Veterans and service members for college degree and certificate programs, technical or vocational courses, flight training, apprenticeships or on-the-job training, high tech training, licensing and certification test, for correspondence courses. Remedial, deficiency, and refresher courses may be approved under certain circumstances. Benefits generally expire 10 years after discharge. Current payment rates are available at http://www.benefits.va.gov/gibill/.
A Veteran may be eligible for this benefit if he or she entered active duty after June 30, 1985, has an honorable discharge, did not decline MGIB in writing, and served three continuous years of active duty (or have an obligation to serve four years in the Selected Reserve after active duty services). There are exceptions for disability, re-entering active duty, and upgraded discharges. All participants must have a high school diploma, equivalency certificate, or have completed 12 hours toward a college degree before applying for benefits.
GI Bill Resident-Rate Requirements
Section 417 of Public Law 114-315 requires VA to disapprove programs of education for payment of benefits under the Post-9/11 GI Bill and Montgomery GI Bill-Active Duty at public institutions of Higher Learning (IHLs) if the school charges qualifying Veterans and dependents tuition and fees in excess of the rate for resident students for terms beginning after July 1, 2017. To remain approved for VA’s GI Bill programs, schools must charge in-state tuition and fee amounts to “COVERED INDIVIDUALS”.
Covered Individual Is Defined As
- A Veteran who lives in the state where the IHL is located (regardless of his/her formal state of residence) and enrolls in the school within three years of discharge from a period of active duty service of 90 days or more.
- An individual using transferred benefits who lives in the state where the IHL is located (regardless of his/her formal state of residence) and enrolls in the school within three years of the transferor’s discharge from a period of active duty services of 90 days or more.
- Anyone described above while he or she remains continuously enrolled (other than during regularly scheduled breaks between courses semesters, or terms) at the same school. The person described must have enrolled in the school prior to the expiration of the three-year period following discharge or release as described above and must be using educational benefits under either Chapter 30 or Chapter 33, of Title 38, United States Code.
- Anyone using transferred Post-9/11 GI Bill benefits who lives in the state where the IHL is located and the transferor is a member of the uniformed service who is serving on active duty.
- Anyone using benefits under the Marine Gunnery Sergeant John David Fry Scholarship who lives in the state where the IHL is located (regardless of his/her formal state of residence).
- The in-state tuition provisions in Section 417 do not apply to those individuals on active duty using benefits under the Post-9/11 GI Bill and Montgomery GI Bill-Active Duty. Public IHLs must offer in-state tuition and fees to all covered individuals with Post-9/11 GI Bill and Montgomery GI Bill-Active Duty (MGIB-AD) benefits in order for programs to remain approved for GI Bill benefits for terms beginning after July 1, 2017. After July 1, 2017, VA will not issue payments for any students eligible for the Post-9/11 GI Bill or the MGIB-AD until the school becomes fully compliant. These requirements ensure our Nation’s recently discharged Veterans, and their eligible family members, will not bear the cost of out-of-state charges while using their well-deserved education benefits.
VA Home Loans
Home Loan Guaranty
VA home loan guarantees are issued to help eligible service members, Veterans, Reservists, National Guard members, and certain surviving spouses obtain homes, condominiums, and manufactured homes, and to refinance loans. Although it’s preferable to apply electronically, it is possible to apply for a Certificate of Eligibility (COE) using VA Form 26-1880, Request for Certificate of Eligibility. In applying for a hard-copy COE using VA Form 26-1880. It is typically necessary that the eligible Veteran present a copy of his/her report of discharge or DD Form 214, Certificate of Release or Discharge from Active Duty, or other adequate substitute evidence to VA. An eligible active duty service member should obtain and submit a statement of service signed by an appropriate military official to the VA Eligibility Center. For general program information or to obtain VA loan guaranty forms please visit: http://www.benefits.va.gov/homeloans/ or call 1-877-827-3702 to reach the home loan program’s local office of jurisdiction.
A completed VA Form 26-1880 and any associated documentation should be mailed to the nearest Regional Loan Center (RLC) of jurisdiction. The RLC jurisdictions and mailing addresses are located on page 3 of VA Form 26-1880, http://www.vba.va.gov/pubs/forms/vba-26-1880-are.pdf.
Please note that while VA’s electronic applications can establish eligibility and issue an online COE in a matter of seconds, the system can only process cases for which VA has sufficient data in its records. Therefore, certain applicants will not be able to establish eligibility online and additional information might be requested prior to the option of submitting an electronic application.
Home Loan Guaranty Uses
A VA loan guaranty helps protect lenders from loss if the borrower fails to repay the loan. It can be used to obtain a loan to : Buy or build a home; buy a residential condominium unit; repair, alter, or improve a residence owned by the Veteran and occupied by the Veteran and occupies as a home; refinance an existing home loan; buy a manufactured home and/or lot and install a solar heating or cooling system or other energy-efficient improvements.
Home Loan Guaranty Eligibility
In addition to the periods of eligibility and conditions of service requirements, applicants must have a good credit rating, sufficient income, a valid Certificate of Eligibility (COE), and agree to live in the property in order to be approved by a lender for a VA home loan. Lenders can apply for a COE online through the Veterans information Portal (https://vip.vba.va.gov/portal/VBAH/Home). Active duty service members and Veterans can also apply online at http://www.ebenefits.va.gov
Some spouses of Veterans may have home loan eligibility: The unmarried surviving spouse of a Veteran who died as a result of service or service-connected causes. The surviving spouse of a Veteran who dies on active duty or from service-connected causes, who remarries on or after attaining age 57 and on or after December 16, 2003. The spouse of an active duty member who is listed as missing in action (MIA) or a prisoner of war (POW) for at least 90 days.
Eligibility Under The MIA/POW Provisions
is limited to one-time use only. Surviving spouses of Veterans who died from nonservice-connected causes may also be eligible if any of the following conditions are met: the Veteran was rated totally service-connected disabled for 10 years or more immediately preceding death, or was rated totally disabled for not less than five years from date of discharge or release from active duty to date of death, or was a former prisoner of war who died after September 30, 1999, and was rated totally service-connected disabled for not less than one year immediately preceding death.
Home Loan Guaranty Limits
VA does not make loans to Veterans and service members: VA guarantees loans made by private-sector lenders. The guaranty is what VA could pay a lender should the loan go to foreclosure. VA does not set a cap on how much an individual can borrow to refinance a home. However, there are limits on the amount of liability VA can assume, which usually affects the amount of money an institution will lend. For information on loan limits please visit: http://www.benefits.va.gov/homeloans/purchase-co_loan_limits.asp.
Other Types Of Loans
An eligible borrower can use a VA-guaranteed Interest Rate Reduction Refinancing Loan to refinance an existing VA loan and lower the interest rate and payment. Typically, no credit underwriting is required for this type of loan. The loan may include the entire outstanding balance of the prior loan, the costs of energy-efficient improvements, and closing costs, including up to discount points. An eligible borrower who wishes to obtain a VA-guaranteed loan to purchase a manufactured home or lot can borrow up to 95% of the home’s purchase price. The amount VA will guarantee on a manufactured home loan is 40 percent of the loan amount or the Veteran’s available entitlement, up to a maximum amount of $20,000. These provisions apply only to a manufactured home that will not be placed on a permanent foundation.
Home Loan Guaranty Appraisals
No loan can be guaranteed by VA without first being appraised by a VA-assigned fee appraiser. A home appraised by a VA assigned fee appraiser is required for purchase and certain refinance loans guaranteed by VA. A lender can request a VA appraisal through VA systems. The Veteran borrower typically pays for the appraisal upon completion, according to a fee schedule approved by VA. This VA appraisal estimates value of the property. An appraisal is not an inspection and does not guarantee the house is free of defects. VA guarantees the loan, not the condition of the property.
A thorough inspection of the property by a reputable inspection firm may help minimize any problems that could arise after loan closing. In an existing home, particular attention should be given to plumbing, heating, electrical, roofing, and structural components. In addition, VA strongly recommends testing for radon, a known carcinogen.
Home Loan Guaranty Closing Costs
For purchase home loans, payment in cash is required on all closing costs, including title search and recording fees, hazard insurance premiums, and prepaid taxes. For refinancing loans, all such costs may be included in the loan, as long as the total loan does not exceed the reasonable value of the property. Interest rate reduction loans may include closing costs, including a maximum of two discount points.
Home Loan Guaranty Funding Fees
The funding fee is a percentage of the loan amount collected in order to offset future anticipated costs associated with the loan. A funding fee must be paid to VA unless the Veteran is exempt from such a fee. Currently, exemptions from the funding fee are provided for Veterans and service members receiving VA disability compensation, those who are rated by VA as eligible to receive compensation as a result of pre-discharge disability examination and rating, and those who would be in receipt of compensation, but who were recalled to active duty or reenlisted and are receiving active-duty pay in lieu of compensation. Additionally, unmarried surviving spouses in receipt of dependency and indemnity compensation may be exempt.
The fee may be paid in cash or included in the loan. For all types of loans, the loan amount may include the VA funding fee and up to $6,000 of energy-efficient improvements.
However, no other fees (including fees for the VA appraisal, credit report, loan processing fee, title search, title insurance, recording fees, transfer taxes, survey charges, or hazard insurance), charges, or discount points may be included in loans for purchase or construction. For refinancing loans, most closing costs may be included in the loan amount.
Home Loan Guaranty Required Occupancy
To qualify for a VA home loan, a Veteran or the spouse of an active-duty Service member must certify that he or she intends to occupy the home. A dependent child of an active-duty Service member also satisfies the occupancy the interest rate, a Veteran only needs to certify prior occupancy.
Home Loan Guaranty Financing, Interest Rates And Terms
Veterans obtain VA-guaranteed loans through the usual lending institutions, including banks, credit unions, and mortgage brokers. VA-guaranteed loans can have either a fixed interest rate or an adjustable rate, where the interest rate may adjust up to one percent annually and up to five percent over the life of the loan. VA does not set the interest rate. Interest rates are negotiable between the lender and borrower on all loan types.
Veterans may also choose a different type of adjustable rate mortgage called a hybrid ARM, where the initial interest rate remains fixed for 3-10 years. If the rate remains fixed for less than five years, the rate adjustment cannot be more than one percent annually and five percent over the life of the loan. For a hybrid ARM with an initial fixed period of five years or more, the initial adjustment may be up to two percent.
The Secretary has the authority to determine annual adjustments thereafter. Currently, annual adjustments may be up to two percentage points and six percent over the life of the loan. If the lender charges discount points on the loan, the Veteran may negotiate with the seller as to who will pay points or if they will be split between buyer and seller. Points paid by the Veteran may not be included in the loan (with the exception that up to two points may be included in interest rate reduction refinancing loans). The term of the loan may be for as long as 30 years and 32 days.
Home Loan Guaranty Assumption Requirements And Liability
VA loans made on or after March 1, 1988, are not assumable without the prior approval of VA or its authorized agent (usually the lender collecting the monthly payments). To approve the assumption, the lender must ensure that the purchaser is a satisfactory credit risk and will assume all of the Veteran’s liabilities on the loan, if approved the purchaser will have to pay a funding fee that the lender sends to VA, and the Veteran will be released from liability to the federal government. (A VA-guaranteed loan may be assumed by Veterans, active duty personnel, and non-Veterans alike.
Loans made prior to March 1, 1988, are generally freely assumable, but Veterans should still request the lender’s approval in order to be released of liability. Veterans whose loans were closed after December 31, 1989, usually have no liability to the government following a foreclosure, except in cases involving fraud, misrepresentation, or bad faith, such as allowing an unapproved assumption. However, for the entitlement to be restored, any loss suffered by VA must be paid in full.
A release of liability does not mean that a Veteran’s guaranty entitlement is restored. That occurs only if the borrower is an eligible Veteran who agrees to substitute his or her entitlement for that of the seller. If the Veteran allows assumptions of a loan without prior approval, then the lender may demand immediate and full payment of the loan, and the Veteran may be liable if the loan is foreclosed and VA has to pay a claim under the loan guaranty.
VA Assistance To Veterans In Default
When a VA-guaranteed home loan becomes delinquent; VA may provide supplemental servicing assistance to help cure the default. The servicer has the primary responsibility of servicing the loan to resolve the default, and VA urges all Veterans who are encountering problems making their mortgage payments to speak with their servicers as soon as possible to explore options to avoid foreclosure. Contrary to popular opinion, servicers do not want to foreclosure because foreclosure costs money. Depending on a Veteran’s specific situation, servicers may offer any of the following options to avoid foreclosure.
The borrower makes a regular installment each month plus part of the missed installments.
The servicer agrees not to initiate foreclosure to allow time for borrowers to repay the missed installments or agrees to place a hold or postpone foreclosures proceedings. An example of when this would be likely is when a borrower is waiting for a tax refund.
Provides the borrower a fresh start by adding the delinquency to the loan balance and establishing a new payment schedule.
When the servicer agrees to allow a borrower to sell his/her home for a lesser amount than what is currently required to pay off the loan.
Deed-In-Lieu Of Foreclosure
The borrower voluntarily agrees to deed the property to the servicer instead of going through a lengthy foreclosure process.
In cases where the servicer is unable to help the Veteran borrower, VA has loan technicians at its eight Regional Loan Centers (RLCs) and in Hawaii, who are available to take an active role in interceding with the mortgage servicer. Veterans potential ways to help save the loan.
Service Members Civil Relief Act (SCRA) And Home Loan Guaranties
Veteran borrowers may be able to request relief pursuant to the SCRA. In order to qualify for certain protections available under the Act, their obligation must have originated prior to their current period of active military service. SCRA may provide a lower interest rate during military service and for up to one year after service ends, provide forbearance, or prevent foreclosure or eviction up to nine months from period of military service.
Assistance To Veterans With VA-Guaranteed Home Loans
When a VA-guaranteed home loan becomes delinquent; VA may provide supplemental servicing assistance to help cure the default. The servicer has the primary responsibility of servicing the loan to resolve the default. Veterans with VA-guaranteed home loans can call 1-877-827-3702 to reach the nearest VA office where loan specialists are prepared to discuss potential ways to help save the loan.
Assistance To Veterans With Non-VA Guaranteed Home Loans In Default
VA advises Veterans or service members who are having difficulty making payments on a non-VA-guarantees loan to contact their servicer as quickly as possible to explore options to avoid foreclosure. Although for non-VA loans, VA does not have authority to directly intervene on the borrower’s behalf, VA network loan technicians at eight Regional Loan Centers and an office in an office in Hawaii can offer advice and guidance on how to potentially avoid foreclosure. Veterans or service members with non-VA-loans may call 1-877-827-3702 to speak with a VA loan technician, or visit: www.benefits.va.gov/homeloans/, for more information on avoiding foreclosure.
If VA is not able to help a Veteran borrower retain his/her home (whether a VA-guaranteed loan or not), The Department of Housing and Urban Development (HUD) offers assistance to homeowners by sponsoring local housing counseling agencies. To find an approved agency in your area, search online at www.hud.gov/offices/hsg/sfh/hcc/hcs.cfm or call HUD’s interactive voice system at 1-800-569-4287.
VA Refinancing Of A Non-VA Guaranteed Home Loan
Veterans with non-VA guaranteed home loans now have new options for refinancing to a VA-guaranteed home loan. These new options are available as a result of the Veteran’s Benefits Improvement Act of 2008. Veterans who wish to refinance their subprime or conventional mortgage may now do so up to 100 percent of value of the property.
Other Assistance For Delinquent Veteran Borrowers
If VA is not able to help a Veteran borrower retain his/her home (whether a VA-guaranteed loan or not), the Department of Housing and Urban Development (HUD) offers assistance to homeowners by sponsoring local housing counseling agencies. To find an approved agency in your area, please visit: http://www.hud.gov/offices/hsg/sfh/hcc/hcs.cfm, or call HUD’s interactive voice system at 1-800-569-4287.
Preventing Veteran Homelessness
Veterans who believe they may be facing homelessness as a result of losing their homes can call 1-877-4AIDVET (877-424-3838) or visit: www.va.gov/HOMELESS/index.asp to receive assistance in preventing homelessness.
VA Acquired Property Sales
VA acquires properties as a result of foreclosures of VA-guaranteed and VA-owned loans. A private contractor currently markets the acquired properties through listing agents using local Multiple Listing Services. A listing of “VA Properties for Sale” may be found at http://listings.vrmco.com/. Contact a real estate agent for information on purchasing a VA-acquired property.
Loans For Native American Veterans
Eligible Native American Veterans can obtain a loan from VA to purchase, construct, or improve a home on federal Trust Land, or to reduce the interest rate on such a VA loan. Native American Direct Loans (NADLS) are only available if a memorandum of understanding exists between the tribal organization and VA. Veterans who are not Native American but who are married to Native American non-Veterans, may be eligible for a direct loan under this program.
To be eligible for such a loan, the qualified non-Native American Veteran and the Native American Spouse must reside on federal Trust Land, both the Veteran and spouse must have a meaningful interest in the dwelling or lot, and the tribal authority that has jurisdiction over the Trust Land must recognize the non-Native American Veteran as subject to its authority. For additional information about the NADL program please visit: http://www.benefits.va.gov/homeloans/nadl.asp.