How Does BAH as Rent Work?
How Does BAH as Rent Work?
Using your Basic Allowance for Housing (BAH) for rent is easy. Essentially, service members simply need to sign a Resident Occupancy Agreement (ROA) to give permission to allot their BAH entitlements to rent. Then, the soldier’s information is entered into a database, and the BAH will be collected by a management company on behalf of the Army and paid to the housing partnership on the first of each month. Don’t worry, your family’s take-home pay won’t change at all—you will simply see a “rent allotment” in the third column of your Leave and Earnings Statement (LES).
Read on for more detailed information on how BAH works as rent.
Before privatization, a military family essentially forfeited the Basic Allowance for Housing (BAH) in exchange for living in government quarters on post. Upon transfer of responsibilities for housing, all families living on-post in Corvias communities saw their BAH show up on their LES. At the same time BAH begins appearing on the statement, the service members living in on-post family housing allot their BAH to the privatization partnership between Corvias and the Army.
Rather than receiving the BAH into their accounts and then making monthly rent payments, service members sign an ROA, similar to a civilian lease. The signed ROA gives the government permission to start the rent allotment, which equals the soldier’s BAH entitlement for his or her rank. The allotment should reflect any BAH increases or decreases that occur, but soldiers need to check it regularly for accuracy.
If a family is dual military (both husband and wife are on active-duty), both service members will receive the appropriate BAH. Their rent will equal the senior grade member’s BAH at the “with dependent” rate. The other service member gets to keep their BAH.
Once the ROA is signed, the soldier’s information is entered into a database for the third-party collecting the allotments. The BAH will be collected and managed by the Military Assistance Company (MAC), an allotment management contractor who works for the Army.
MAC has been processing military allotments since 1985 and serves military housing offices in all branches of service. The payment system is fully automated and is interfaced with the Defense Finance and Accounting Service (DFAS). This system facilitates starting, managing, tracking, updating and stopping BAH allotments.
BAH is paid to the partnership on the first of the following month, which means the allotment for April will be paid May 1. That is when the service member will see the first transaction appear on his or her LES. The BAH amount being paid will appear on the left side of the LES under “Entitlements.” The rent allotment will appear in the third column of the LES under “Allotments” for an amount equal to the BAH. There will be no change in a family’s take-home pay.
Stopping a BAH allotment upon move out is as easy as starting it. Once Corvias has officially cleared the resident and any charges for damages beyond normal wear and tear have been paid, the allotment will be stopped. After move-out, any refund due will be made within 10 business days after the partnership receives the allotment for the last month’s rent.
The rent payment process is designed to be smooth and seamless. If BAH does not appear on the LES or if the service member receives an entitlement and it is not taken out as an allotment, he should see his neighborhood manager immediately. The BAH money is earmarked for rent. If the BAH money is not taken out by allotment, the service member will be responsible for paying rent in cash until the problem is corrected.
*Not applicable to all branches of service, please contact the Leasing and Relocation Center for details