In this article, we will discuss and cover the VA property tax exemption guidelines on VA home loans. The Department of Veterans Affairs (The VA) created and implemented VA Home Loans for eligible active and retired members of the United States Armed Services. To qualify for VA loans, members of the U.S. Military need to have a valid Certificate of Eligibility (COE). The VA offers VA Home Loans to eligible members as a reward for them serving our country. In the following sections of this blog, we will cover what is a VA loan and the VA property tax exemption guidelines on VA home loans.
What Is a VA Loan and Who Qualifies?
VA Loans is the best loan program for owner-occupant primary residence home buyers. There are many benefits to VA loans. The main benefit is homebuyers can purchase a home with zero down payment and no maximum loan limit. The VA has lenient mortgage agency guidelines with regards to credit, debt-to-income ratio, and credit scores. Many states offer VA Property Tax Exemption to disabled veterans. VA Property Tax Exemption depends on the percentage of the veterans disabled and on the individual states
Who Can Get VA Property Tax Exemption On VA Loans
VA Property Tax Exemptions are not authorized by the Department of Veterans Affairs. It is the individual states and/or county governments that offer VA Property Tax Exemptions. Every state and county has its own VA Property Tax Exemption Guidelines for veterans of the United States Armed Services. To qualify, only disabled veterans are eligible. Most states will offer 100% Property Tax Exemption for veterans who are 100% disabled. It is not automatically offered to disabled veterans. It depends on the percentage of disability that determines the property tax exemption.
VA Loan Benefits For Disabled Veterans
The percentage of disability of the disabled veteran is not uniform nationwide. It is up to the individual counties of each state on the eligibility requirements. Veterans need to apply for VA Property Tax Exemption after they have closed on their homes. Homeowners who have a service-related disability can apply for VA Property Tax Exemption. Those who do not have 100% disability can apply for a partial Property Tax Exemption.
Property Tax Exemption Saves Homeowners From Paying Property Taxes
All disabled veterans are encouraged to apply for Property Tax Exemption. Even veterans who are only partially disabled may qualify for a partial exemption. It depends on the individual county on who qualifies on VA exemption on property taxes.
The amount of savings is dependent on the following:
- Percent disabled rating by the Department of Veterans Affairs
- The county and state the property is located
- Type of property
- Other factors required by the individual county and state the property is located
The veteran homeowner may need to register and re-apply for the exemption annually or every few years. This is dependent on the state.
What Benefits Do You Get With a VA Loan?
Gustan Cho Associates are lenders of VA loans with zero overlays. There are many benefits of using a VA loan for a home purchase. Here is the list of the countless benefits offered by the VA:
- Zero down payment with 100% financing
- No closing costs with the use of sellers concessions and/or lender credit
- No monthly mortgage insurance required
- The VA Funding Fee can be rolled into the loan
- VA Loans have the lowest mortgage rates out of all other loan programs due to the VA guarantee
- Homeowners with a current VA Loan can refinance their loan into another new VA Loan with a lower rate with no closing costs
- This streamline VA refinance loan program is called an IRRRL
- The VA permits a 100% LTV cash-out refinances
- There is a two-year waiting period after bankruptcy, foreclosure, deed in lieu of foreclosure, short-sale on VA Loans
- Borrowers can qualify for VA Loans during the Chapter 13 Bankruptcy repayment plan with Trustee Approval
- Chapter 13 Bankruptcy does not have to be discharged
- There is no waiting period after the Chapter 13 Bankruptcy discharged date
Outstanding collections and charged-off accounts do not have to be paid off to qualify for VA Home Loans.
How Does VA Property Tax Exemption Work
Homeowners need to qualify for a Property Tax Exemption on VA loans after they have closed on their home loans. A 100% disabled homeowner who is a veteran of the U.S. Armed Services is likely to get a 100% property tax exemption. However, this exemption does not kick in until the homeowner is living in the house and has applied for the exemption. It normally takes 6 or more months for a property tax exemption to kick in after the application. All Property Tax Exemption on VA mortgages is state-specific.
California VA Property Tax Exemption Guidelines on VA Loans
For California, here are the guidelines and the rules:
California Property Tax Exemptions. For honorably discharged veterans, spouse or pensioned-parents of the deceased: $4,000 real property or personal property exemption by the California Constitution. Disabled Veterans exemption. Depending on income, there is a basic $100,000 or $150,000 exemption available. There are limitations when applying in California for these exemptions.
Colorado Property Tax Guidelines on VA Loans
Below are the Colorado property tax guidelines on VA home loans:
For disabled Veterans who qualify. 50% of the first $200,000 in actual value for a primary residence. The procedure in Colorado requires disabled veterans to submit an application to the Division of Veterans Affairs. This should be done between January 1st and July 1st of the qualifying year.
Florida VA Property Tax Exemption Rules
Many counties throughout the state of Florida offer VA property tax exemption. Many active and retired veterans of the U.S. Military call Florida home. Mike Richardson does a high volume of VA loans in Florida. Mike said the following:
In Florida, the exemption depends on certain requirements. An ex-service member who is honorably discharged who is disabled 10% is eligible to a $5,000 reduction in the assessed value of the property. A permanently disabled Veteran is eligible for a total exemption from taxes. Other requirements allow Veterans to get a discount on their taxes. To see if you are eligible, you should go to Florida’s Department of Revenue’s website.
Georgia VA Property Tax Rules And Guidelines
Below are the Georgia VA property tax rules and guidelines on VA loans:
Disabled Veterans or surviving spouse are eligible for an exemption in Georgia of $60,000 plus from paying property taxes. The exemption depends on an index rate set by the United States Secretary of Veteran’s Affairs.
Illinois Tax Exemption Guidelines on VA Loans
Below are the Illinois tax exemption guidelines on VA loans:
For returning Veterans, there is a $5,000 reduction to returning Veterans equalized assessed value. Returning veterans from active duty in an armed conflict involving the U.S. armed forces can apply upon their return. To apply for Returning Veterans’ Homestead exemption in Illinois, a Veteran would have to contact or visit a local County Assessor’s office. Standard Homestead Exemption for Disabled Veterans: For a disabled veteran, the Standard Homestead Exemption applies a reduction in the property’s EAV to qualified Veterans with service-related disabilities. Beginning in 2015 tax year: For a veteran with a service-related disability of at least 30%, a $2,500 homestead exemption is available. A VA property tax exemption (homestead exemption) is available of $5,000 to Veterans with a service-related disability of at least 50%. Veterans who have a service-connected disability of at least 70% are exempt from paying property taxes. This is also available to surviving spouses under circumstances. Veterans must be approved for this exemption and file annual applications by their counties deadline. In order to apply in Illinois, a Veteran would have to contact or visit a local County Assessor’s office.
Texas VA Tax Exemption Rules And Guidelines
Below are the VA tax exemption rules and guidelines for the state of Texas:
The exemption depends on the disability rating. The amount is as follows: $5,000 from the property value if 10% to 29% disabled. $7,500 from the property value if 30% to 49% disabled. $10,000 from the property value if 50% to 69% disabled. $12,000 from the property value if 70% to 100% disabled. You can apply for a tax exemption in Texas by going to the TexVet website.
Virginia VA Property Tax Exemption Guidelines
Virginia’s real estate tax exemption allows 100% service-connected, permanent and totally disabled veterans or surviving spouse to be granted exemption from taxes when the application is approved.
Washington VA Property Tax Exemption Guidelines For Disabled Veterans
Below are the Washington VA property tax exemption guidelines for disabled veterans:
In order to get property tax relief in Washington, you should contact your County Assessor to determine how much you can save. Applicants with service-connected disability rating may qualify for relief on their property tax bill for primary residences.
Property Tax Exemption in the Other States on VA Loans
Below is a statement about property tax exemption in other states on VA loans:
You can find if your state has opportunities to save money on taxes by going to the state or county website. Often these are listed on the state’s Department of Revenue site.
For more information about the content of this article and/or other mortgage-related topics, please contact us at Gustan Cho Associates at 800-900-8569 or text us for a faster response. Or email us at firstname.lastname@example.org. Gustan Cho Associates Mortgage Group is available 7 days a week, on evenings, weekends, and holidays.
July 23, 2022 - 7 min read