VA Home Loan GRACE Act of 2021
Bill: H.R.6124 | Sponsor: Rep. Brown, Anthony G. (D-MD)
Policy area: Armed Forces and National Security

Summary:
Veteran Affairs Home Loan Guaranty Resiliency And Concurrency Enhancement Act of 2021 or the VA Home Loan GRACE Act of 2021
This bill modifies provisions related to the Department of Veterans Affairs home loan program, including by establishing a penalty for knowingly making a false certification for a loan under the program.

To amend title 38, United States Code, to increase the maximum guaranty 
 amount for loans made to certain veterans under the laws administered 
     by the Secretary of Veterans Affairs, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Veteran Affairs Home Loan Guaranty 
Resiliency And Concurrency Enhancement Act of 2021'' or the ``VA Home 
Loan GRACE Act of 2021''.

SEC. 2. BASIC PROVISIONS RELATING TO LOAN GUARANTY AND INSURANCE.

    (a) In General.--Section 3703(a)(1) of title 38, United States 
Code, is amended--
            (1) in subparagraph (A)--
                    (A) by striking ``Any'' and inserting ``Except as 
                provided in subparagraphs (C) and (D), any''; and
                    (B) by striking ``the lesser of'' and all that 
                follows through the period at the end of clause (ii) 
                and inserting ``the lesser of the maximum guaranty or 
                the maximum amount of guaranty entitlement available to 
                the veteran, as specified in the table in subparagraph 
                (B).'';
            (2) by striking subparagraph (B) and inserting the 
        following new subparagraph (B):
    ``(B) The table referred to in subparagraph (A) is as follows:


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                                                     Maximum
                  ``Type of Loan                     Guaranty        Maximum Amount of Guaranty Entitlement
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(i)(I) Any loan of not more than $45,000 to a       50 percent  $36,000
 veteran who is not a covered veteran              of the loan
(i)(II) Any loan of not more than $45,000 to a      50 percent  50 percent of the Freddie Mac conforming loan
 covered veteran (closed before April 7, 2027)     of the loan   limit, reduced by the amount of entitlement not
                                                                 restored
(i)(III) Any loan of not more than $45,000 to a     50 percent  25 percent of the Freddie Mac conforming loan
 covered veteran (closed on or after April 7,      of the loan   limit, reduced by the amount of entitlement not
 2027)                                                           restored
(ii)(I) Any loan of more than $45,000, but not         $22,500  $36,000
 more than $56,250, to a veteran who is not a
 covered veteran
(ii)(II) Any loan of more than $45,000, but not        $22,500  50 percent of the Freddie Mac conforming loan
 more than $56,250, to a covered veteran (closed                 limit, reduced by the amount of entitlement not
 before April 7, 2027)                                           restored
(ii)(III) Any loan of more than $45,000, but not       $22,500  25 percent of the Freddie Mac conforming loan
 more than $56,250, to a covered veteran (closed                 limit, reduced by the amount of entitlement not
 on or after April 7, 2027)                                      restored
(iii)(I) Except as provided in clause (iv)(I), in   the lesser  $36,000
 the case of any loan of more than $56,250, to a    of $36,000
 veteran who is not a covered veteran                    or 40
                                                    percent of
                                                      the loan
(iii)(II) Except as provided in clause (iv)(II),    the lesser  50 percent of the Freddie Mac conforming loan
 in the case of any loan of more than $56,250, to   of $36,000   limit, reduced by the amount of entitlement not
 a covered veteran (closed before April 7, 2027)         or 40   restored
                                                    percent of
                                                      the loan
(iii)(III) Except as provided in clause             the lesser  25 percent of the Freddie Mac conforming loan
 (iv)(III), in the case of any loan of more than    of $36,000   limit, reduced by the amount of entitlement not
 $56,250, to a covered veteran (closed on or             or 40   restored
 after April 7, 2027)                               percent of
                                                      the loan
(iv)(I) Any loan of more than $144,000 for a        25 percent  25 percent of the loan
 purpose specified in clause (1), (2), (3), (5),   of the loan
 (6), or (8) of section 3710(a) of this title, to
 a veteran who is not a covered veteran
(iv)(II) Any loan of more than $144,000 for a       25 percent  50 percent of the Freddie Mac conforming loan
 purpose specified in clause (1), (2), (3), (5),   of the loan   limit, reduced by the amount of entitlement not
 (6), or (8) of section 3710(a) of this title, to                restored
 a covered veteran (closed before April 7, 2027)
(iv)(III) Any loan of more than $144,000 for a      25 percent  25 percent of the Freddie Mac conforming loan
 purpose specified in clause (1), (2), (3), (5),   of the loan   limit, reduced by the amount of entitlement not
 (6), or (8) of section 3710(a) of this title, to                restored'';
 a covered veteran (closed on or after April 7,
 2027)
----------------------------------------------------------------------------------------------------------------

            (3) in subparagraph (C)--
                    (A) by redesignating clause (iii) as subparagraph 
                (E); and
                    (B) by striking subparagraph (C) and inserting the 
                following:
    ``(C) Except as provided in subparagraph (D), when two or more 
veterans use guaranty entitlement on a single loan, the loan is 
automatically guaranteed by the United States in an amount not to 
exceed the lesser of--
            ``(i) the maximum guaranty as specified in the table in 
        subparagraph (B); or
            ``(ii) the sum of the maximum amount of guaranty 
        entitlement available to each veteran, as calculated pursuant 
        to the table in subparagraph (B).'';
            (4) by inserting after subparagraph (C) the following new 
        subparagraph (D):
    ``(D)(i) Except as provided in clause (ii), if two or more veterans 
use guaranty entitlement on a single loan described in subparagraph 
(B)(iv), the loan is automatically guaranteed by the United States in 
an amount not to exceed the lesser of the following:
            ``(I) In the case of a loan for which--
                    ``(aa) at least one veteran is a covered veteran, 
                25 percent of the Freddie Mac conforming loan limit; or
                    ``(bb) no veteran is a covered veteran, 25 percent 
                of the loan.
            ``(II) The sum of the maximum amount of guaranty 
        entitlement available to each veteran, as calculated pursuant 
        to the table in subparagraph (B).
    ``(ii) Clause (i) shall not apply to a loan made to two veterans 
who are married to each other if there are no other obligors on the 
loan.''; and
            (5) in subparagraph (E), as redesignated by paragraph 
        (3)(A)--
                    (A) by striking ``subparagraph'' and inserting 
                ``paragraph''; and
                    (B) by redesignating subclauses (I) and (II) as 
                clauses (i) and (ii), respectively.
    (b) Penalties for False Certification.--Section 3704(c) of such 
title is amended by adding at the end the following new paragraph:
    ``(3) Any veteran who knowingly and materially makes a false 
certification under paragraph (1) or (2) of this subsection shall be 
liable to the United States Government for a civil penalty in an amount 
not to exceed $23,607. A penalty under this paragraph may be in 
addition to any other remedy available to the Secretary. All 
determinations necessary to carry out this paragraph shall be made by 
the Secretary.''.
    (c) Loan Fees.--The loan fee table in section 3729(b)(2) is amended 
by striking ``April 7, 2023'' each place it appears and inserting 
``April 7, 2027''.
    (d) Effective Date.--The amendments made by this Act shall take 
effect on the date that is 180 days after the date of the enactment of 
this Act.
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