I
104TH CONGRESS
1ST SESSION
H. R. 1611
To amend title 38, United States Code, to authorize the Secretary of Veterans
Affairs to assist in alleviating housing shortages for active duty personnel
through interest rate buy downs, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
MAY 11, 1995
Mr. MONTGOMERY introduced the following bill; which was referred to the
Committee on Veterans’ Affairs, and in addition to the Committee on Na-
tional Security, for a period to be subsequently determined by the Speak-
er, in each case for consideration of such provisions as fall within the ju-
risdiction of the committee concerned
A BILL
To amend title 38, United States Code, to authorize the
Secretary of Veterans Affairs to assist in alleviating
housing shortages for active duty personnel through in-
terest rate buy downs, and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. AUTHORITY OF THE SECRETARY OF VETERANS
AFFAIRS TO MAKE CERTAIN MORTGAGE AS-
SISTANCE PAYMENTS.
(a) AUTHORITY.—Chapter 37 of title 38, United
States Code, is amended by inserting after section 3707
the following:
‘‘§ 3708. Authority to buy down interest rates
‘‘(a) In order to enable the purchase of housing in
areas where the supply of suitable military housing is in-
adequate, the Secretary may make periodic assistance pay-
ments on behalf of an eligible veteran for the purpose of
buying down the interest rate on a loan to that veteran
that is guaranteed under this chapter for a purpose de-
scribed in paragraph (1), (2), (3), (6), or (10) of section
3710(a).
‘‘(b) An individual is an eligible veteran for the pur-
poses of this section if—
‘‘(1) the individual is a veteran, as defined in
section 3701(a)(4) of this title, or is on active Guard
and Reserve duty, as defined by section 101(d) of
title 10;
‘‘(2) the individual submits an application for a
loan guaranteed under this chapter within one year
of an assignment of the individual to duty at a mili-
tary installation in the United States designated by
the Secretary concerned as a housing shortage area;
‘‘(3) at the time the loan referred to in sub-
section (a) is made, the individual is an enlisted
member, warrant officer, or an officer (other than a
warrant officer) at a pay grade of O–3 or below;
‘‘(4) the individual has not previously used any
of the individual’s entitlement to housing loan bene-
fits under this chapter; and
‘‘(5) the individual receives comprehensive
prepurchase counseling from the Secretary before
making application for a loan guaranteed under this
chapter.
‘‘(c) Loans with respect to which the Secretary may
exercise the buy down authority under subsection (a)
shall—
‘‘(1) provide for a buy down period of not more
than three years in duration;
(2) specify the maximum and likely amounts of
increases in mortgage payments that the loans would
require; and
‘‘(3) be subject to such other terms and condi-
tions as the Secretary may prescribe by regulation.
‘‘(d) The Secretary shall promulgate underwriting
standards for loans for which the interest rate assistance
payments may be made under subsection (a). Such stand-