President Trump is expected to sign a measure that clarifies a previous law that inadvertently made affordable federal mortgage loans unattainable for veterans.
The Government National Mortgage Association, known as Ginnie Mae, buys mortgages from lenders and pools them together to sell to investors.
Ginne Mae couldn’t pool about 2,500 Veterans Affairs loans worth $500 million taken out last year because of unclear language in a 2018 law. Qualified veterans faced higher closing costs and borrowing rates as a result.
U.S. Representative Lee Zeldin of Long Island pushed for change.
“This fix is essential to prevent a liquidity crisis in the veterans home mortgage market and ensure the brave men and women who have served our nation in uniform have access to affordable mortgages.”
The previous law protects veterans from predatory lenders, but Zeldin says Ginnie Mae decided to block many VA home loans because of unclear requirements the law set.
“Even one VA home loan negatively impacted by a minor mistake is one too many when it comes to giving our veterans access to homeownership.”
The VA home loan program helped link more than 610,000 veterans with more than $160 billion last year to attain homeownership.