Housing buoyed by 20-year high for vets’ loans
WASHINGTON – July 23, 2014 – After a series of fits and starts, the national housing recovery is now enjoying a burst of activity from the military population. The withdrawal of U.S. troops from overseas war zones means that a large number of enlisted persons are coming home and ready to buy homes.
Hazard pay, combined with tax-free housing and food allowances, has positioned many to amass a sizable downpayment; and even those who cannot afford to put a large amount down can benefit from one of the easiest and least expensive financing options available: Veterans Affairs mortgages.
"VA buyers are coming into the market in higher and higher proportions and tend to be first-time buyers, one of the missing drivers in the recovery in housing demand," notes CoreLogic deputy chief economist Sam Khater.
VA financing for purchase loans jumped 19 percent to 241,190 loans in fiscal 2013, the most since at least 2000. And for the first three months of this year, they made up 8.1 percent – $19.5 billion – of mortgage activity, up from 6.9 percent in the same quarter of last year.
Besides the return of deployed soldiers, the VA loan program is gaining market share because of its newfound popularity in light of FHA changes that have made its products more costly for borrowers.
Source: BusinessWeek (07/22/14) Gopal, Prashant; Shenn, Jody
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