[Congressional Record (Bound Edition), Volume 157 (2011), Part 12]
[Senate]
[Page 16589]
[From the U.S. Government Publishing Office, www.gpo.gov]




INTRODUCTION OF A BILL TO AMEND TITLE 38, UNITED STATES CODE, TO EXTEND 
THE DEPARTMENT OF VETERANS AFFAIRS DEMONSTRATION PROJECTS ON ADJUSTABLE 
          RATE MORTGAGES AND HYBRID ADJUSTABLE RATE MORTGAGES

                                 ______
                                 

                         HON. LINDA T. SANCHEZ

                             of california

                    in the house of representatives

                      Wednesday, November 2, 2011

  Ms. LINDA T. SANCHEZ of California. Mr. Speaker, I rise today to 
introduce a bill to amend title 38, United States Code, to extend the 
Department of Veterans Affairs demonstration projects on adjustable 
rate mortgages and hybrid adjustable rate mortgages.
  My bill would ensure we continue to provide affordable mortgages for 
our veterans, who put their lives on the line protecting our freedom. 
This VA-backed mortgage program is currently set to expire next year.
  In contrast to traditional Adjustable Rate Mortgages (ARMs), VA-
guaranteed ARMs limit the annual interest rate adjustment to a maximum 
increase or decrease of one percent. Over the life of the loan, the 
interest rate is limited to a maximum increase of five percent. For VA-
backed hybrid ARMs, the interest rate adjustment is limited to two 
percent each year, with a maximum increase of six percent over the life 
of the loan.
  Compared to a conventional mortgage, VA-backed ARMs and hybrid ARMs 
make it easier for veterans to obtain affordable financing. If interest 
rates drop, veterans can save thousands of dollars in mortgage 
payments. This legislation would make mortgages more affordable and 
would play an important role in combating veteran homelessness.
  The Department of Veterans Affairs estimates that over 100,000 
veterans are homeless, while 1.5 million veterans are considered ``at 
risk'' of homelessness due to poverty and substandard housing 
arrangements. These mortgage extensions encourage veterans to pursue 
the American Dream of homeownership and ensure that they are not living 
on the streets due to the volatility and exposure of traditional 
mortgages.
  Mr. Speaker, one of the most overarching public policy goals of the 
Congress and our country is to take care of our veterans. I strongly 
believe that providing affordable mortgage rates is a key component in 
our effort to meet this goal. I urge our colleagues to join me in 
supporting this successful and necessary program.

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