On August 26, 2014, the Obama Administration announced a new initiative that will make it easier for active-duty service members to achieve the dream of home-ownership. For potential homeowners, the decision to buy a home is one of the largest financial decisions they will ever make.
The 2203 Service members Civil Relief Act (SCRA) already makes active duty military members eligible for home loan interest rates capped at 6%. But the Government Accountability Office (GAO) found that many men and women in uniform don’t benefit from SCRA because they are unaware of the benefits, or are put-off by the red tape.
President Obama announced a plan to have five of the country’s largest mortgage lenders join the federal government to make the process easier and more accessible to service members. The companies have agreed to increase the frequency in which they check DOD databases to see whether their customers are entitled to unclaimed benefits, which would save the service members money.
According to White House officials, Bank of America, Quicken Loans, Citi Mortgage, Wells Fargo Bank, and Ocwen Loan Servicing are participating in the program.
“We’re announcing a new partnership in which some of America’s biggest banks and financial institutions will simplify the process, proactively notify service members who qualify for lower rates and make it easier to enroll,” Obama said at the American Legion National Convention. “In other words, we’re going to help more of our troops and military families own their own home without a crushing debt.”
It is expected that the partnership could help tens of thousands of military families save money on their mortgage rates.
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Military Connection: Lower Loan Rates for Troops: By Debbie Gregory