Senate amendment cuts expansion of VA mortgage financing fee

Everyone celebrated when the Blue Water Navy Vietnam Veterans Act was passed congress last year and was signed by President Donald Trump.

The law provides benefits for Navy veterans who were exposed to Agent Orange during the Vietnam War. but There was a detail hidden in the small print What many lawmakers missed when voting on the bill was that it was funded by walking fees on mortgages secured by the mortgages Veterans Administration.

“These are all worthwhile benefits, and we want veterans to get the care they deserve, but why is Congress choosing to pay for these benefits on the backs of military families?” Chris Birk, director of education for Veterans unitedthe largest VA lender, told HousingWire at the time.

Now, another attempt to make military members and active-duty veterans pay for services for other current and former members of the armed forces is doomed to fail — at least in part, under an amendment by Senator Jerry Moran (R-KS). HR 3504a bill approved by Congress on Monday that will provide funds to adapt housing for disabled veterinarians.

The fee increase in last year’s Blue Water Navy bill temporarily raised the VA mortgage financing fee from 2.15% to 2.3% for first-time buyers and from 3.3% to 3.6% for subsequent buyers through Jan. 1, 2022. Most Vets roll the fee into their loans, meaning they pay off their fee with interest for the time they own their property.

The original version of the bill passed this week was paid for by extending these Blue Water fee increases through October 2, 2027. That extra five years and 10 months would have resulted in VA borrowers paying an additional $529 million in fees — not including the interest they may pay for up to 30 years to fund the higher fees.

Moran’s amendment reduced some of the spending in the bill and shortened the extension of the higher fees to an additional year and four months – until April 7, 2023.

This will cost VA borrowers an additional $118 million, compared to $529 million in the original version of the bill, saving VA borrowers $411 million in fees.

“For 75 years the VA home loan was an economic lifeline for veterans and military families,” said Nate Long, CEO of Veterans United, after the law was passed. “We appreciate that Senator Moran recognizes that continuing to increase the cost of using this benefit harms those who serve and defend our country.”

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