- Members of the military receive different types of base pay depending on their pay grade and time in service. The type of job has no bearing on how much the base pay is. Enlisted pay grades range from E-1 to E-9. Officers' pay grades rise from O-1 to O-9, and warrant officers' range from W-1 to W-5. An E-5 with six years' duty who disables roadside bombs earns the same base pay as an E-5 with six years' service who repairs trucks. Mortgage companies treat base pay just as they treat anyone else who receives a salary.
- The military guarantees housing for its service members. Many live in barracks on post, or live in on-post housing free of charge. Those who purchase their homes off-post or live off-post receive a Basic Allowance for Housing (BAH). This income is not taxable by the federal government. Mortgage companies treat nontaxable income differently than taxable income. Most mortgage companies increase the income by 125 percent of its base value. If a service member receives $1,000 for BAH each month, the mortgage company qualifies the income at $1,250 because it is not taxable. The benefit amount varies with the rank and location of the service member.
- The military also promises to feed its troops. Those who live off-post are not expected to eat at the dining facility, so they receive a Basic Allowance for Subsistence (BAS) each month. This money pays for the service member's meals each day. Mortgage companies increase this income just as they do with BAH.
- Some service members receive special pay types -- for example, pilots receive flight pay, and those in combat receive hostile fire/imminent danger pay. Depending on where the service person is stationed, she may also receive a cost-of-living adjustment (COLA). All of this pay may be used to qualify the service member if it is needed. Often these extra pay types account for only a few hundred dollars each month. Some of these are taxable, and others are not.
- Advertisement -
- Advertisement -