Reporting Rental Property and Income

Discussion in 'How to Apply Questions' started by Kaiya, Dec 29, 2016.

  1. Kaiya

    Kaiya Newbie

    My Dad's application for pension benefits is now being processed by the VA. Yesterday he received a letter saying that since he did not state that he had any assets in real property, the VA has requested additional information: the current market value of the home as reported by a real estate professional or appraiser; the type of property he is receiving income from; and if the property is a home, whether this was his primary residence before he moved to the assisted living facility, or a second home that he owns. The VA also requested that he fill out a Form 21-4185, Report of Income from Property or Business for the past calendar year.
    Furthermore, since he (actually myself and my brother, who is handling our Dad's financial affairs) did not file a Fully Developed Claim, the VA cannot process the application under the Fully Developed Claim program, and they will process it under the standard claim processing procedure.
    This has caused me some consternation because I understood that the first house, whether a personal residence is lived in or rented out, does not have to be declared. Maybe I misunderstood that.
    I never heard of the Form 21-4185, or any requirement to list expenses of the house, such as taxes and utilities, since they do not count towards countable income.
    Believe me, I would have gone the extra mile to provide this information in the original application had I known it was required.
    Anyway, I have a few questions:
    -A real estate appraisal would cost several hundred dollars, which our Dad can't spare, and my brother and I would have to share the cost in, and more importantly would take 4 to 8 weeks to get. Would an estimate of value from a real estate website be sufficient? Or, would a market value analysis from a real estate agent be sufficient?
    -Do we have to submit bank statements to prove the income and expenses of the rental, which the VA requested 12 months' worth? Or would just the filled out form 21-4185 be enough?
    -The type of property is a detached single family home, in which the downstairs and upstairs are rented out to 2 separate tenants. In the application, I attached 2 months' bank statements, and noted the change from a single tenant to 2 tenants. The rental income increased, but it shows that he is trying to help himself.
    -Our Dad's house was his primary residence, but just before he moved to assisted living he lived in our Mom's house, serving as her caregiver. After she died, he stayed in the house until it was obvious he could not live by himself. During the time he was our Mom's caregiver and until he moved to assisted living, his house was rented out. Can we still state that the house was his primary residence before he moved to assisted living?
    -Now for the mechanics of filing the additional documentation. Is it okay to paste a printout of the answers to the VA's questions directly on to the Form 21-4138, Statement in Support of Claim, and make a clean copy of the form?
    -The VA encourages using the eBenefits website to upload documents. I have read on the Forum that eBenefits is not recommended. Could you please explain the pros and cons of using eBenefits? The VA says that it's the "quickest, easiest, and most secure way to submit any documents." Is this true? I'm wondering if we should send the documents by certified mail instead.

    Thank you for your help on this journey, which I spent countless hours on and there were a few tears. I was elated that I made it to sending the application, but I know there are more challenges ahead. I am disappointed that the VA needed more information in order to process the claim, and that meant that the application would not be given expedited treatment. Is there anything we can do now to expedite the process?
    davidbilly likes this.
  2. Kaylin

    Kaylin Hero Member Staff Member

    The 21-4185 is not a standard form that most people use in the application process. Either way you will have to provide the VA with information that they request. Normally the home a person owns is not counted into a person's assets but since your father rents out the property to tenants the VA wants to understand how much income he makes from this or potential income he could make to pay for his care.

    Yes, technically the house was his primary residence before moving into an ALF (assisted living facility). But since he rents the property out and uses the income for himself the VA will still have to know how much income he can get for this property.

    I believe you can paste the printout of answers to the VA's questions onto the 21-4138. I don't see why that would be an issue. But if it were me doing the application I would write/type them out onto the 21-4138 without pasting just to make sure it's not sent back. Up to you! I'd be curious to know if it's okay to send the form like that.

    Pros of using eBenefits:
    The application or documents will get to the VA faster (most likely) and you don't have to worry about anything getting lost in the mail.
    Cons of eBenefits:
    We have heard from many users on the forums that the eBenefits site has glitches and doesn't always work correctly. Also if you submit a letter in the mail you can always use return receipt to make sure it is delivered and would therefore know exactly what date the VA received it.

    Out of curiosity is your father 90 years old or older? If so you can expedite the application based on his age.

    I hope this helps in some way - thank you for your kind words and I hope we can continue to help you out here at!
    davidbilly likes this.
  3. Kaiya

    Kaiya Newbie

    Thank you very much for your reply. I still have a question about establishing the home value. An appraisal I think is overkill. It's expensive and time consuming, and time is of the essence. My brother contacted a real estate agent and she suggested a estimate of value. You type in the address of the property and out pops a webpage with the address, property details, and estimate of value. I printed this out on Dec 30 to establish a date. Since value is established by comparing recent sales of comparable properties, I would think that Zillow would be okay. We decided that we would go with that and if the VA is not satisfied, we would pay for an appraisal. Do you think this is a good strategy?
    -Do we need to submit proof of rental income and expenses for the past year, i.e., 12 months' of bank statements? We will fill out the form 21-4185 with 12 months' worth of data.
    -I just thought that a printed version of my answers, pasted in form 21-4138, then photocopied so there is a clean copy (no pasted in paper), would be easier to read. Why would the VA object to that? If it really makes a difference, I will hand write my answers instead. Too bad, I sold my typewriter 15 years ago!

    About using eBenefits, I think my brother is willing to give it a try. Maybe he can follow up within one week of uploading the documents. Using certified mail, we tracked the original application and it took 5 days via priority mail. So we would speed things up, theoretically by one week. I'll let you know what our experience is.
    -my father is 94 years old. How do I expedite the process, just state his age on the form 21-4138?
    Thank you!
  4. Kaylin

    Kaylin Hero Member Staff Member

    Kaiya - I think the Zillow strategy is a good one. I've used Zillow before and it is a good resource for that! I think adding any additional evidence that you can to support the 21-4185 form numbers on expenses and income would help. Bank statements are almost always a good idea to include.

    Ah! I see what you mean about the photocopy. That makes sense to me and I'm sure would be sufficient. As long as the paper wasn't literally just pasted on with tape or glue.

    Please do let us know your experience with the eBenefits. We're always looking for more insight here.

    If your father is 94, simply use the 21-4138 form to add a sentence or two on there requesting it to be expedited due to his age. An example is "We request that you expedite this Aid and Attendance benefit application due to my father's advanced age of 94 years old."

    You're welcome!
  5. davidbilly

    davidbilly Newbie

    Yes Kaylin, I agree that the 21-4185 is not a standard form that most people use in the application process. You replied well and shared some good information here. Thanks

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