The Department of Veterans Affairs has announced that it guaranteed the 20 millionth home loan since the home loan program was created by the GI Bill of Rights in 1944 after veterans from World War II returned home. The 20 millionth home loan was guaranteed for asurviving spouse in Woodbridge, Virginia, after their spouse passed away in the Iraq War in 2010.
The VA reports that the loan program has grown largely in the past five years because of low interest rates. About 71 percent more purchases and 2000 percent more refinances occurred in the fiscal year of 2012 than in 2007. There are about 1.7 million home loans guaranteed by the VA, and 540,000 were guaranteed in 2012 alone. The value of the mortgages is about $284 billion.
The program through the VA makes homes more affordable to Veterans, current servicemembers, and the surviving spouses of veterans. Banks are attracted to such mortgages because they do not suffer losses if the loan is not repaid.
According to the Mortgage Bankers Association, guaranteed mortgages by the VA were the least likely to foreclose in the last 17 quarters, and they’ve had the lowest delinquency rate in the last 14 quarters.
VA’s undersecretary for benefits, Allison A. Hickey, stated: “The 20 millionth VA home loan is a major milestone and is a testament to VA’s commitment to support and enhance the lives of Veterans, Servicemembers, their families and survivors. As a result of their service and sacrifice, as a group, they prove to be disciplined, reliable, and honorable—traits that are ideal for this kind of national investment.”
A large amount of success in the home loan program comes from the fact that VA employees are given every opportunity to avoid foreclosure and stay in their home as long as possible. The VA has saved taxpayers $8 billion since 2009 by helping veterans avoid foreclosures.
Source: Department of Veterans Affairs