In testimony before Congress today, bankers and mortgage bankers alike talked about what needs to be improved at the U.S. Department of Veterans Affairs.
On behalf of the American Bankers Association, Acacia Federal Savings Bank chairman and Chief Executive Officer James Barber testified that the agency could use some improvements, according to a news release.
He gave his testimony before the House Committee on Veterans Affairs at the hearing, The Status of the Loan Guarantee Program.
“The program could benefit from allowing national lenders to rely on a single point of contact within the program structure, rather than needing to work with the various regional offices,” Barber recommended to lawmakers.
Other suggestions from Barber included centralizing the regional program Web sites, creating an online eligibility calculator for veterans and automating the process for VA condominium loans.
Still, Barber praised the VA program and called it “a unique and valuable program that should be continued.”
Also speaking before legislators, on behalf of the Mortgage Bankers Association, was Residential Mortgage Corp. President James H. Danis II.
Danis claims VA loans account for 70 percent of his Fayetteville, N.C.-based company’s business. He noted that VA has provided 100 percent loan-to-value financing as the credit markets have tightened up. Yet he also pointed out that although VA borrowers have no skin in the game, they “have outperformed their counterparts through the recent housing crisis.”
But the MBA spokesman asked the lawmakers to exempt VA loans from a 5-percent risk-retention requirement — though he requested the same exemption for all agency loans. He also requested an extension of VA’s higher loan limits implemented under the Veterans Benefits Improvement Act of 2008 from the end of 2011 “until the housing crisis has subsided.”
“VA management should have the flexibility to make programmatic changes that keep the program competitive, current, and relevant in a rapidly changing market,” Danis testified. “And while my company does not service loans, I know that MBA’s members who do, often report that VA’s processes can be made simpler and more cost-effective.”
