Announcement from the office of Representative Derek Kilmer.
Tacoma, WA – On Thursday, U.S. Representatives Derek Kilmer (WA-06) and Guy Reschenthaler (PA-14) led a bipartisan letter signed by more than 60 of their colleagues to U.S. Department of Veterans Affairs (VA) Secretary Denis McDonough, urging the VA to improve its mortgage to make homeownership more accessible to American veterans. Specifically, lawmakers asked the secretary to explore how VA mortgages can be competitive in today’s market and ensure veterans have bargaining power throughout the home buying process.
“If you serve this country, the federal government should support you. This means that every veteran should receive the benefits they have earned and deserve, including housing,” Rep. Kilmer said. “I believe every veteran should have a home, and it shouldn’t be under a highway overpass. That’s why I’m helping lead the bipartisan effort to make homeownership more accessible to our country’s veterans and improve the VA mortgage process. We need to make progress to ensure that every veteran has a fair chance.
“Our nation’s proud and deserving veterans are struggling to secure a home in today’s market using their VA mortgage benefits,” said. representing Reschenthal. “As a Navy veteran, I believe the VA needs to review its mortgage process and implement the necessary reforms to ensure veterans can compete and buy a home in today’s highly competitive housing market. today.”
“Our nation’s veterans have provided invaluable service in protecting our freedoms and our American way of life. It is only right that we ensure that they receive the benefits they deserve,” lawmakers wrote. “We call on your department to improve the VA mortgage lending process and request a report on steps VA has taken to increase lending competitiveness. It is imperative that veterans receive a competitive loan that gives them the opportunity to purchase a home.
The full text of the letter can be read here and below.
According to the National Association of Realtors, the median home sale price rose 15% year-over-year and inventory fell 0.3 months from February 2021. That’s 120 consecutive months of decline. year-over-year increases, longest streak on record.
The increase in cash and conventional loans with waived contingencies has reduced veterans’ ability to compete in today’s housing market. VA borrowers fare less well than borrowers using conventional loan products, with 11% of VA borrowers switching loan products during their home search, compared to just 1% of conventional borrowers switching their financing method.
The letter was also signed by: Representatives Brian Fitzpatrick (PA-01), Eric Swalwell (CA-15), Fred Keller (PA-12), Mike Kelly (PA-16), Vicky Hartzler (MO-04), Brian Mast (FL-18), Doug LaMalfa (CA-01), Juan Vargas (CA-51), Dina Titus (NV-01), Tom O’Halleran (AZ-01), Eleanor Holmes Norton (DC-AL) , Rodney Davis (IL-13), Stephanie Bice (OK-05), Adriano Espaillat (NY-13), Yvette Herrell (NM-02), Mike Turner (OH-10), Raul Grijalva (AZ-03), Chris Pappas (NH-01), Jahana Hayes (CT-05), Mariannette Miller-Meeks, MD (IA-02), Dan Meuser (PA-09), Susie Lee (NV-03), Glenn “GT” Thompson (PA – 15), Scott Franklin (FL-15), Ed Case (HI-01), Jay Obernolte (CA-08), Michael Waltz (FL-06), William Timmons (SC-04), Cathy McMorris Rodgers (WA- 05), Fred Upton (MI-06), Jake Ellzey (TX-06), Tim Ryan (OH-13), Ben Cline (VA-06), Katie Porter (CA-45), Henry C. “Hank” Johnson , Jr. (GA-04), Adam Smith (WA-09), Elaine Luria (VA-02) Mario Díaz-Balart (FL-25), Gus M. Bilirakis (FL-12), Jaime Herrera Beutler (WA-03), Rashida Tlaï b (MI-13), Cindy Axne (IA-03), David Kustoff (TN-08), Debbie Lesko (AZ-08), David G. Valadao (CA-21), Ted W. Lieu (CA-33), Sam Graves (MO-06), Peter Meijer (MI-03), Michael FQ San Nicolas (GU-AL), Ken Calvert (CA-42), Bill Johnson (OH-06) , Tracey Mann (KS-01), Ralph Norman (SC-05), Angie Craig (MN-02), Suzan DelBene (WA-01), Carlos A. Gimenez (FL-26), Kim Schrier, MD (WA- 08), Brad Sherman (CA-30), John Carter (TX-31), Richard Hudson (NC-08), Ed Perlmutter (CO-07), Elise M. Stefanik (NY-21) and Linda T. Sánchez ( CA-38).
The Honorable Denis McDonough
US Department of Veterans Affairs
810 Vermont Avenue N.W.
Washington, D.C. 20420
Dear Secretary McDonough:
Thank you for your work to ensure that the men and women who have served our country receive the benefits they rightly deserve. It is with these efforts in mind that we write to ask your department to work to make home ownership more accessible for veterans in our country. Specifically, we believe the Department of Veterans Affairs (VA) should explore how VA mortgages can be competitive in today’s market and ensure veterans have bargaining power throughout the process of buying a home. home.
As you may know, buyers face an incredibly competitive housing market and have for some time. According to the National Association of REALTORS®, February 2022 saw a median sale price of $357,300 and 1.7 months of inventory. Median selling price was up 15% year-over-year and inventory was down 0.3 months from February 2021. That’s 120 consecutive months of year-over-year increases , the longest streak ever recorded. Sellers have benefited the most from this intense real estate market, generally earning their full asking price.
Historically, VA mortgages have been attractive and competitive to sellers. Unfortunately, the current housing market and the increase in cash and conventional loans with waived contingencies may prevent veterans from competing with other buyers. VA borrowers fare less well than borrowers using conventional loan products, with 11% of VA borrowers switching loan products during their home search, compared to just 1% of conventional borrowers switching their financing method. This is of particular concern given the alarming levels of veteran homelessness in our country. In 2021, 19,750 veterans experienced homelessness.
Our nation’s veterans have provided invaluable service in protecting our freedoms and our American way of life. It’s okay for us to make sure they get the benefits they deserve. We call on your department to improve the VA mortgage lending process and request a report on steps VA has taken to increase lending competitiveness. It is imperative that veterans receive a competitive loan that gives them the opportunity to purchase a home. To better understand the problem, we ask for answers to the following questions:
- How is the VA working to improve assessment policy and procedure, such as minimum ownership requirements, to improve veterans’ ability to compete, while maintaining levels of Protection Appropriate for Loan Guarantee Program and Veteran Homebuyers?
- At what level should the financing commission be set to strictly cover the risk of non-payment and the guarantee payments of 25% of the mortgage loan program?
- Does VA have the resources it needs to commission a study identifying what percentage of VA financing fees is currently spent on the home loan guarantee program, and what percentage is diverted to other programs?
- How does the VA work to improve public perception of the VA mortgage program?
- How can Congress help the VA in its efforts to improve the competitiveness of the mortgage program?
We look forward to your response and working with you to resolve this important issue for our veterans.