07/10/2019 | Press release | Distributed by Public on 07/10/2019 20:39
(Washington, D.C.) - Yesterday, the House of Representatives passed H.R. 1988, the Protecting Affordable Mortgages for Veterans Act of 2019. The bipartisan piece of legislation, introduced by Congressman David Scott (D-VA), provides a technical fix critical to maintaining liquidity in the veteran home loan market and ensuring continued access to affordable VA mortgages. Congressman Emanuel Cleaver, II (D-MO) was one of the bill's seven cosponsors.
'I'm thankful to Congressman Scott for his leadership in shepherding this bill through the House of Representatives, and happy for our nation's veterans and military personnel that Congress was able to come together with overwhelming bipartisan support,' said Congressman Cleaver. 'Quality, affordable housing has been proven to lead to better health and higher quality of life. It is imperative that Congress do everything possible to ensure our country's military heroes have ample opportunity to secure fair loans that allow them to partake in the American dream, and this bill is a great step in that direction.'
'I am so pleased that the House moved swiftly to pass my bill, H.R. 1988,' said Congressman Scott. ' It is absolutely essential that we strengthen the veteran home loan market and preserve safe, affordable, and accessible borrowing opportunities for our military personnel and veterans. This bipartisan legislation will preserve critical VA refinancing protections for our veterans while at the same time allowing for these orphaned veteran loans to be securitized. Making this change will free up liquidity, enabling lenders to make new loans and ensuring that veteran borrowers have access to the VA home loan benefits they have earned. I want to thank my bipartisan cosponsors, Representatives Lee Zeldin, Mike Levin and Andy Barr for their leadership on behalf of our servicemembers in moving this bill forward.'
H.R. 1988 corrects deficiencies of S. 2155, the Economic Growth, Regulatory Relief, and Consumer Protection Act, which passed in the previous Congress. S. 2155 included reforms intended to protect veterans from the predatory practice of loan churning, the process of rapidly and repeatedly refinancing home loans to generate fees and profits for lenders with little or no benefit to the veteran homeowner. Unfortunately, the language of the bill, combined with unclear timelines for implementation of the new requirements caused approximately 2,500 refinanced loans, which met federal requirements at the time of closing and were guaranteed by the VA, to be ineligible for Ginnie Mae securitization. These 'orphaned loans' are barred from the secondary market, creating a strain on liquidity for lending institutions and potentially driving up future borrowing costs. H.R. 1988 corrects these deficiencies of S. 2155 and also makes it easier for banks to follow a rule for refinancing veterans' home loans so that they qualify for VA guarantees.
Emanuel Cleaver, II is the U.S. Representative for Missouri's Fifth Congressional District, which includes Kansas City, Independence, Lee's Summit, Raytown, Grandview, Sugar Creek, Blue Springs, Grain Valley, Oak Grove, North Kansas City, Gladstone, Claycomo, and all of Ray, Lafayette, and Saline Counties. He is a member of the exclusive House Financial Services Committee; Chairman of the House Subcommittee on National Security, International Development, and Monetary Policy; member of the Select Committee on the Modernization of Congress; member of the Committee on Homeland Security; and a Senior Whip of the Democratic Caucus. For more information, please contact Matthew Helfant at 202-225-4535 or [email protected] A high-resolution photo of Congressman Cleaver can be found here.