Home Loan Program Going Strong Despite Tight Market
WASHINGTON (Nov. 1, 2010)- With mortgage rates at historic lows,
Veterans and military personnel continue to use the Department of
Veterans Affairs (VA) home loan program in record numbers to purchase a
home or refinance their existing loans.
"Home ownership is one of the foundations of the American dream," said
Secretary of Veterans Affairs Eric K. Shinseki. "VA is honored to
administer a benefit that for two-thirds of a century has profoundly
affected the lives of our Veterans, our military Servicemembers, and
Since the VA Home Loan program began in 1944 as part of the Montgomery
GI Bill, VA has helped Veterans by guaranteeing more than 19 million
home loans, valued at more than $1 trillion. During the past four
years, the number of Veterans VA has helped purchase a home has risen by
VA's foreclosure rate for the last nine quarters and serious delinquency
rate for the last six quarters have been the lowest in the housing
industry, even when compared to prime loans, according to the Mortgage
Bankers Association's National Delinquency Survey.
In a time where other no-downpayment programs are virtually non-existent
and mortgage credit can be difficult to obtain, Veterans and
Servicemembers have an avenue to obtain financing and take advantage of
historically low rates through the VA home loan program.
Most Veterans, Servicemembers, Reservists and National Guard members, as
well as some surviving spouses, are eligible for the program, which
provides an opportunity for borrowers to qualify for no-downpayment home
loans as well as regular and interest-rate-reduction refinance home
VA-guaranteed home loans are made by banks and mortgage lenders, with VA
ensuring payment of a portion of the loan if the borrower fails to repay
A unique aspect of VA's program is a commitment to help borrowers keep
their homes if they encounter financial difficulties. During the past
decade, VA loan specialists have helped more than 150,000 families hold
onto their homes when threatened by foreclosure.
Shinseki attributed the "professionalism and savvy" of VA employees and
the "unshakeable sense of responsibility" among Veterans and military
personnel as key factors for maintaining a low foreclosure rate on
VA-backed home loans.
VA's loan specialists can intervene on a Veteran's behalf with the loan
servicer to explore home-retention options, including repayment plans,
loan modifications, and forbearance. When home retention is not an
option, VA can help arrange a compromise sale or a deed-in-lieu of
foreclosure, both of which are less detrimental to borrowers than