Over the last few years, the Department of Veterans Affairs (VA) Home Loan Program has gained significant market share, compared to competing private and government mortgage options. One of the main reasons for this is that big banks and mortgage companies have increased efforts to help returning Veterans become homeowners.
The VA Home Loan Program is now at record highs, having more than doubled since 2007. Back in 2011, VA guaranteed home loans made up only 3% of mortgages in the country. In Fiscal Year 2014, VA guaranteed home loans jumped to around 7%.
There are many reasons why VA loans are rapidly increasing. First and foremost, there is a large demand for homes among the Veteran community. With the number of Iraq and Afghanistan Veterans separating from the service, there is an influx of families, relocating and looking for homes. In total, the VA estimates that there are more than 22 million Veterans from all generations, across the country. The majority of these Veterans will qualify for VA loans. And with today’s economy, the only way that some Veterans will get approved for a home loan is through the VA.
Here’s how the process works, in a nutshell: A Veterans applies for a certificate of eligibility from the VA. The VA reviews the Veteran’s credit, earning potential, etc. and then approves or disapproves the Veteran. Veterans with a certificate of eligibility are then free to seek out private lenders vetted with the VA. The lenders provide the loans to the Veteran, with the VA’s guarantee that if the Veteran is unable to pay the loan, the lender will still be paid back.
Lenders recognize VA loans as good business. And VA guaranteed loans come with zero down payment and generous finance rates that make home ownership more affordable for the men, women and families who have made sacrifices in service to their country.
There are also scores of non-profits that partner with large corporations and lenders to help Veterans become homeowners. Organizations such as Habitat for Humanity, Homes for Heroes, the Military Warriors Support Foundation, HomeStrong USA, Operation Homefront, and Purple Heart Homes have gifted hundreds of homes to Veterans. Many of these houses were acquired through donations from major lenders, including Bank of America, JPMorgan Chase, SunTrust Mortgage, Wells Fargo, and U.S. Bank.
Considering the struggles many Veterans face in light of the current economy, it’s satisfying to see so many Veterans and military families are able to fulfill their dream of owning their own home. It’s the very least a grateful nation can provide for as a way to say thank you for the sacrifices they have made.
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Military Connection: More Veterans Owning Homes: By Debbie Gregory