WASHINGTON, February 28, 2008 – The National Association of Realtors® testified today in Congress that the Veterans Home Loan Guaranty Program should continue to be a valuable asset in helping the nation’s veterans achieve the dream of homeownership in a way that is safe, fair and affordable.
“The VA Home Loan Guarantee Program is designed to provide favorable loan terms for veterans who are unable to qualify for a conventional loan,” said Tony Agurs, a member of the NAR Board of Directors and Realtor® from California who is a 21-year U.S. Marine Corps veteran. “The VA program offers unique and important benefits for helping our military families achieve the dream of homeownership,” Agurs said.
NAR cited a 2004 study that found that 82 percent of first-time home buyers through the VA program could not qualify for a conventional loan. The report also found that 61 percent of those borrowers could not meet the downpayment or debt-to-income ratios required to qualify for an FHA loan. “It is our duty as a country to make sure that our retired and active duty veterans and their families are given every opportunity to own and keep their home if they have the basic means and desire,” said Agurs.
The VA Home Loan Guaranty Program offers protections for borrowers if they encounter financial difficulties by offering a variety of supplemental loan servicing programs to help military families avoid foreclosure. “This is especially important today while we are in an active war and given some of the challenges in today’s housing market. In 2007, the VA successfully intervened and saved nearly 8,500 veterans’ homes, also saving the government $181.3 million in avoided claims. These are big and important numbers and are more than just statistics,” Agurs said.
NAR urged the House Subcommittee on Veterans Affairs to reform the Veterans Home Loan Guaranty Program so it can better serve many more veterans. NAR asked the subcommittee to make various program enhancements to give military families the opportunity to become homeowners. These enhancements include increasing the VA loan limits in high cost areas to 150 percent of conforming loan limits; easing the refinancing requirements and restrictions for veterans, especially those that have fallen victim to risky subprime loans; and offering permanent authorization for the guarantee of adjustable-rate mortgages and hybrid ARMs.
“NAR has a long history of strongly supporting housing opportunities for our nation’s veterans and active duty personnel. It is our hope that this subcommittee will support our recommendations for enhancing and improving the VA Home Loan Guaranty Program,” Agurs said.
The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing more than 1.3 million members involved in all aspects of residential and commercial real estate industries.