Veterans Loan Limit Raised
|January 7, 2002|
Department Of Veterans Affairs To Guaranty No-Down Payment Mortgages Up To $240,000
Inman News Features
A new law will enable millions of veterans to obtain bigger government-guaranteed mortgages. The Veterans Education and Benefits Expansion Act of 2001 (H.R. 1291) increases the loan guaranty amount on mortgages backed by the U.S. Department of Veterans Affairs from $50,750 to $60,000. The law was passed by Congress before its year-end adjournment and signed into law by President Bush on Dec. 27.
The increase is the first since 1994 and will enable lenders to close no-down payment VA loans up to a new maximum loan amount of $240,000.
The Mortgage Bankers Association of America said the increase "will be of great benefit to veterans and armed services personnel seeking homeownership, particularly in high cost areas."
The VA loan home loan guaranty program was created under the 1944 GI Bill. Under this program, the government guarantees 25 percent of the mortgage loan amount, enabling qualified veterans to borrow up to four times the guaranty with no down payment. More than 29 million veterans and service personnel reportedly are eligible for VA financing.
The National Association of Realtors also applauded the higher VA loan limit.
"Raising the veterans home loan guaranty amount will help millions more veterans become homeowners. We applaud Congress for increasing the limit to better reflect the cost of buying a home today. Every American, particularly veterans who have served their country so well, ought to be able to enjoy the benefits that come with owning your own home," said NAR 2002 President Martin Edwards Jr.
Copyright: Inman News Service