Date: 2004-06-23
Speaker: GINNY BROWN-WAITE (republican)
Chamber: H
State: Flor

ida. Mr. Speaker. I am very pleased to speak on behalf of this legislation. which was introduced to improve the VA home loan program. The Veterans Housing Affordability Act. H.R. 4345. is a good government solution which will assist veterans across the Nation at no cost to the taxpayers. Homeownership is one of the. main building blocks of strong communities and also a strong economy. A home is the largest financial investment most American families will ever make. and it allows them to build financial security as the equity in their home increases. Moreover. this tangible asset provides a family with borrowing power to finance important needs such as the education of their children. It is. also a nest egg with very reliable and significant returns on investment regardless of race. color. or creed. The VA has been providing home loan guarantees to men and women who serve our country since 1944. Under this program. the veteran purchases a home through a private lender and the VA guarantees to pay the lender a iortion of the loss if the veteran defaults on the loan. Because of this benefit. millions of veterans have been able to realize the American dream of owning their own home. Since its inception in 1944. the VA has guaranteed $748 billion in loans for 16.9 million homeowners. In 2002. the VA guaranteed more than $40.1 billion in loans to finance the purchase or refinance 317.250 homes. Obviously. this program is a riproaring success. It has been a tremendous asset to veterans and their families at minimum cost to the government. The first decade of the 21st century. however. has seen an expansive growth in home values. For homeowners this has.been a tremendous boon. They have seen their tangible. asset increase in value. In some regions. home values have more than doubled in the last 5 years. However. those not fortunate to already be a homeowner are facing daunting prices for entrylevel homes. In New Jersey. median housing prices hover in the 300 to $400.000 range. The same is true for other regions in Connecticut. California. Washington. Virginia. Maryland. Illinois. and even my home State of Florida. Many soldiers postpone their homeownership until after they are out of the service. For these brave veterans. as median housing prices rise. the VA benefit actually decreases. The rising housing market erodes the purchasing power of the VA home loan. Depending on where the veteran lives. the $240.000 amount is simply insufficient to cover their housing needs. This is simply wrong. At the very least. we owe our veterans the same chance at the American dream after their service as they had the day that they enlisted. H.R. 4345 indexes the maximum VA guarantee amount to 25 percent of the Freddie Mac conforming loan rate. The prevailing VA loan limit would be $333.700. and it would continue to automatically adjust to the market and to the housing needs of veterans. The good news is that the Congressional Budget Office has determined that this bill actually saves the government money. Imagine that. helping veterans and saving money. According to the CBO projection. it will save $39 million in 2005 and $208 million over 5 years and a whopping $288 million in 10 years. We are all very proud of the men and women who serve our Nation past and present. and I hope that the Members will agree that the value of the veterans benefit should not vary depending on where they live or when they purchase a home. I think this legislation is important and very timely. and I urge support of this legislation. I certainly want to thank the gentleman- from New Jersey (Chairman SMITH) and also the gentleman from South Carolina for their leadership on issues affecting veterans. and the gentlewoman from California