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EXCLUSIVE: NEW LAW BRINGS BETTER HOUSING BENEFITS FOR VETERANS By: Chris Birk, Director of Content and Communications for VA Loans Insider In early August, President Obama signed a new bill into law with the intent of making much-needed changes to the Veterans Affairs (VA) Home Guaranty Program, as well as providing healthcare to the hundreds of thousands of Marines and Marine families that drank contaminated water at Camp Lejeune North Carolina—the Honoring America' Caring for Camp Lejeune Families Act. While the bill, passed s Veterans and by the House and unanimously by the Senate, has a primary focus to extend healthcare to those affected by Camp Lejeune' breakthrough changes that provide much needed reform to the VA loan program—a program that has been in service since 1944. This piece of bipartisan legislation will provide help in a number of areas. s drinking water, it also makes Surviving Spouses Prior to the bill' widow or widower could receive zero down financing was if his or her spouse died with a service-connected disability or in the line of duty. Meaning, if the surviving spouse' s passing, the only way a military causes, he or she was not eligible. Today, the VA's s husband or wife died of normal mortgage benefits now extend to surviving spouses of veterans, who had a permanent, service-connected disability for at least a decade before their death. Occupancy Requirements Before the bill was made law, if a service member serving abroad were to buy a home, only a spouse could fulfill the occupancy requirement. Those who were married military couples and single-parent service members were powerless to buy homes while deployed. This has now been repealed, ensuring that active duty members can meet the requirements of a new home purchase through a dependent child of the soldier. The VA Funding Fee and Disabled Veterans For every purchase or refinance loan that the VA backs, it applies a fee known as the VA Funding 14 Fee. This fee helps fund the program ensures it remains independent of the congressional appropriations process. Prior to the bill, NONPROFIT COUNSELORS: MISSING LINK BETWEEN BORROWER AND SERVICER? discharge exam by the VA. Meaning, if a disabled veteran tried to buy a veteran borrowers that had service-connected disabilities didn't pay the fee, which is usually financed directly into the loan. But recently, because of delays with the VA's medical system, many soon- to-be veterans have waited months for an official disability rating after receiving a pre- home with the VA home loan program before then, they would have to pay the fee, which forces some VA borrowers into larger mortgages than they can afford. The new policy provides that the VA will waive the fee if a future veteran is eligible to receive compensation for disability, without having the official rating. VA Loan Limits When veterans live in one of the more expensive areas in the country, such as California, Hawaii, or the Eastern Seaboard, they lose some of their purchasing power because of lowered loan limits on VA-backed mortgages. The limits dictate the amount a veteran can borrow without making a down payment. Last year, the loan cap was reduced from $729,750 to $625,500. The bill brought the caps back up to last year' stand until after 2014. s higher levels, which are set to Adjustable-Rate Mortgages At the end of this year, adjustable-rate mortgages will no longer be offered through the VA loan program. Under the Act, adjustable-rate mortgages and hybrid ARMs will continue to be available through the VA. Chris Birk is a former journalist and the author of The Book on VA Loans: An Essential Guide to Maximizing Your Home Loan Benefits. He is also content development director for Veterans United Home Loans. themselves as elusive and unavailable as possible when it comes to communicating with servicers. During a panel at the Five Star Conference, industry experts discussed the reasons behind the difficulty in reaching borrowers. Colleen Hernandez, CEO and president of Delinquent borrowers oftentimes make the Homeownership Preservation Foundation (HPF), says there are three main reasons borrowers don't respond or reach out to servicers. For one, when borrowers don't have the money to bring their account current, for them, it seems pointless to contact their servicer. "They think that their servicer wants money, and, since struggling homeowners often doesn't have that money, they think, 'What's the point?'" Hernandez explained, adding that many homeowners believe calling their servicer will actually speed up the foreclosure process. A second reason is borrowers don't know whom to trust. With the countless scams targeting struggling homeowners, it can be difficult to know who is there to truly help. Hernandez says she Googles foreclosure prevention every morning, and she's amazed by the numbers of yesterday's names that have morphed into new names based on what's trending in the headlines. Hernandez says the third reason borrowers don't reach out is they need help with more than their mortgage. Instead of a home loan rep, they need a financial advisor who can look at the whole picture. Additionally, Hernandez said, "What homeowners typically don't understand is that, more than anything, servicers want performing loans and are often willing to explore ways in which they can bring a loan back to performing status and avoid a costly foreclosure." For borrowers, however, they are oftentimes in a situation where their loan has been sold several times to different servicers. To help borrowers get the information they need as they maneuver their way through confusing terrain, HPF acts as a bridge between borrowers and servicers. "While many servicers now send out letters advising delinquent borrowers to contact them directly, they also recommend that homeowners contact a nonprofit housing counselor," Hernandez said. "Homeowners often feel more comfortable speaking with someone who doesn't have any 'skin in the game,'" Hernandez explained, "and is providing honest, non-judgmental advice on what their options are, the potential impact on their family and their finances, and a lifeline to call for future questions."

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