According to the DoD center for travel, the Basic Allowance for Housing (BAH) is a U.S. based allowance prescribed by geographic duty location, pay grade, and dependency status. It provides uniformed Service members equitable housing compensation based on housing costs in local civilian housing markets within the United States when government quarters are not provided. Essentially, it was created so service members not living on base or in government housing would be able to afford their living situation wherever they are stationed.
Who is eligible for a BAH?
You are eligible for a BAH if you are a permanent service member who is not currently involved in government housing.
What Factors Determine My BAH?
Your BAH is determined by three factors
- Your location (based on your zip code)
- Your pay grade
- Amount of dependants
You can look up your BAH rates here: BAH Calculator
Will your BAH change?
Your BAH rates will change for a various reasons including the following:
- If you are relocated to a location where housing costs are less than your current duty station.
- If you are demoted your new housing cost will match those at your new rank.
- If your dependency status changes your BAH will reflect your new dependant situation.
Different Types of BAH
There are many different types of BAH used to support service members in various situations. Below are the common types of BAH that you will see on a BAH chart:
Partial allowance is for service members who are still currently living in government quarters. The allowance is implemented to help with living costs within the provided housing. It is a fraction of the normal BAH allowance amount and is mainly for menial expenses.
BAH without dependents
The housing allowance rate for a service member without dependants is a lower rate than those with dependance.
BAH with dependents
The housing allowance is NOT determined by how many dependents you have, however, if you do have dependants the BAH rate is higher than those who do not have dependants. If you have multiple dependants or just one dependant, the BAH rate is still the same.
Differential BAH (BAH-DIFF)
The Differential BAH is for service members who have been assigned government living quarters and are paying child support. Take note, according to the DoD center for travel, “A member is not entitled to BAH-Diff if the monthly rate of that child support is less than the BAH-Diff.”
The Overseas Housing Allowance is for service members who are living overseas and are currently active duty. The allowance is different in that is works on a reimbursement system rather than a standard allowance. To calculate your OHA use this link: OHA Calculator.
BAH Owning Vs. Renting
A common question is the differentiation between your BAH and owning rather than renting a property. The BAH rates for people owning a home and renting a home are the same. They use the same locational and ranking factors to determine your allowance. If you are a homeowner you can use your BAH to help pay your monthly mortgage or property bills. The BAH may not cover your entire mortgage payments as it was designed to supplement the median cost of renting within a given area.
BAH Rate Protection
The BAH rate protection policy protects you from a BAH rate change if the rate decreases in the middle of your assignment. BAH rates fluctuate for a plethora of reasons. If rates go down while you are currently enrolled in a BAH program, you are protected from your rates decreasing as long as your status or situation doesn’t change.
What can affect my BAH rates?
If your dependant status changes your BAH will be re-evaluated and adjusted based on the new rates.
Demotion & rank change
If you are demoted or are receiving a lower pay grade than when your BAH was first issued, your rate will be re-evaluated and adjusted based on the new rates.
On the contrary, if you are promoted to a higher rank your BAH will be re-evaluated and you should receive a higher BAH after the adjustment.
Permanent change of station (PCS)
If you are re-station to a new location permanently your BAH will be adjusted for the new area you are located.
BAH was created to help the service members of the United States afford their living situation no matter where they are stationed. Understanding how to use your BAH and allocate it to the correct expenses could help you pay off your house, significantly lower housing expenses, and save money.
To learn more about your BAH specifics, contact one of our loan experts today.