WASHINGTON — The Department of Veterans Affairs announced its 20 millionth home loan guarantee on Friday, a staggering figure for one of the agency’s most used and respected programs.
The milestone loan was awarded to Elizabeth Carpenter, the widow of an Iraq War veteran who died from cancer in 2010. Carpenter and her 3-year-old son Joey used the program to purchase a home in Woodbridge, Va.
“Without this program and all of the benefits we have received from the VA, we would not be here,” she told reporters at a celebration ceremony.
The 68-year-old VA home loan guarantee program boasts a significant participation rate among veterans, military servicemembers and their survivors, with 1.7 million current loans worth $284 billion. Officials said since the start of 2012, VA has guaranteed 540,000 mortgages.
Mike Frueh, director of loan guaranty services for the Veterans Benefits Administration, said the program has held to its same basic tenets since its inception with the passage of the original GI Bill.
Loans are issued through private banks, not the department, but the VA’s backing of the mortgages allows veterans to receive lower interest rates and skip a down payment. Both of those translate into more available spending money for those families, Frueh said.
He also added that the underwriting standards for getting a loan ensure veterans are able to afford monthly payments, and those who run into financial trouble can receive counseling and loan modifications through the program.
“We can make sure these are quality loans,” he said.
The VA’s guarantee program has boasted some of the lowest foreclosure and delinquency rates for all types of home loans in recent years, and is considered among the best performers in the industry, according to officials with the Mortgage Bankers Association.
VA officials estimate the counseling and foreclosure avoidance services have saved more than $8 billion in savings to taxpayers since 2009, and kept thousands of veterans in their homes.