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Helps veterans get fair access to housing and programs
The “Housing Opportunity Through Modernization Act” also known as H.R. 3700, was signed into law by President Obama on July 29th. This came two weeks after the US Senate unanimously passed the housing bill which makes it easier for veterans to buy homes while reforming FHA restrictions on condo financing. The House of Representatives unanimously passed this bill in February. Rep. Blaine Luetkemeyer (R-Missouri), Chairman of the Housing and Insurance Subcommittee of the House Committee on Financial Services, sponsored the bill.
In addition to including provisions that ensures that homeless veterans get fair access to housing and homeless assistance programs, the act authorizes the Rural Housing Service single-family housing guaranteed loan program to delegate approval authority to preferred lenders; extend the amount of time that allows families to use a family unification voucher; provide a common-sense limitation on public housing residents with over-incomes and raising the Family Unification voucher age requirement ceiling.
These changes, which are supported by National Association of REALTORs (NAR), will make FHA recertification process much easier and lowers the current FHA owner-occupancy requirement from 50% to 35%. The act also requires the FHA to change its existing policy on transfer fees to the Federal Housing Finance Agency’s less-restrictive model.
Former NAR president, Chris Polychron, gave testimony on Capitol Hill in 2015 about the FHA’s current condo financing restrictions and how this presents a major hurdle for one of the nation’s most affordable housing options.
NAR’s current president, Tom Salomone agrees, “Condominiums often represent an affordable option that’s just right for first-time and low-to-moderate income homebuyers. Unfortunately, overly burdensome restrictions on condo financing have for too long put that option out of reach for many creditworthy borrowers.”
“This legislation meets those restrictions head on, putting the dream of homeownership back in reach for more Americans,” Salomone said. “Tight inventory and rising home prices are a reality of today’s market, and mortgage credit is hard to come by.”
“We should take every opportunity to clear the path for well-qualified borrowers to purchase a home when they’re ready, and this legislation does just that,” he said.
According to a recent Freddie Mac survey, 19 million Baby Boomers want to buy a home, with 8 million of them wanting to buy within the next four years. Nearly half of the 19 million are looking for more affordable options, which doesn’t bode well for first-time homebuyers that could more of a strain on affordable inventory.
“Sens. Tim Scott, R-SC, and Robert Menendez, D-NJ, have done tremendous work to see H.R. 3700 move forward, and we’re thankful for their support, Salamone said. “Realtors made their voices heard as well, reaching out to their senators and representatives to remind them of how important this issue is to homeownership.”