National Association of Realtors (NAR) President Leslie Rouda Smith recently testified before the House Committee on Veterans’ Affairs Subcommittee on Economic Opportunity during its hearing, “Removing Barriers to Veteran Home Ownership.”
Rouda Smith, a Realtor for 36 years, addressed NAR’s efforts to improve the homebuying process for veterans and servicemembers and offered policy recommendations to help more veterans achieve homeownership.
“NAR has a tradition of service. Twelve percent of our members are veterans or have a spouse or partner who is a veteran. That’s about 180,000 strong,” Rouda Smith told the committee. “Our veterans and servicemembers face unique challenges when purchasing a home, especially in a hot market.”
Rouda Smith highlighted the importance of strengthening the VA Home Loan Guaranty Program, citing its benefits for borrowers and its role in closing the racial homeownership gap.
“The VA Home Loan Guaranty program offers many unique benefits, including a zero down payment requirement,” she said. “VA loan delinquency rates are lower than FHA loans and comparable to conventional loans. With more than 90 percent of veterans choosing a no down payment option, this program shows that prudent underwriting and servicing is key.
“Sixteen percent of Black Americans received financing through the VA in 2018, compared to 9 percent of white Americans. Clearly, hurdles faced by VA borrowers will disproportionally impact homebuyers of color. And, unfortunately, many elements of the VA loan program meant to protect veterans and servicemembers are instead keeping them on the sidelines in today’s housing market.”
Rouda Smith outlined solutions proposed by Realtors to help veterans.
The first is to provide greater flexibility to make VA loan borrowers more competitive, noting one of the VA program’s most significant disadvantages has been the limitations on fees. The second solution is to oppose any increase in funding fees to offset costs associated with non-housing-related expenditures. The third is to ensure veterans and servicemembers understand the advantages of a VA home loan through more robust marketing of the program. The final solution is improving the home renovation and rehabilitation program.
“The overarching theme in our policy solutions is to afford every veteran the opportunity to build wealth through homeownership,” Rouda Smith said. “We look forward to working with the subcommittee and the VA to advance these efforts.”