Today, Congressman David Scott (GA-13) delivered the following statement at a full House Financial Services Committee Markup on H.R. 1988, the Protecting Affordable Mortgages for Veterans Act of 2019. Sponsored by Congressman Scott and Reps. Mike Levin (D-CA) and Andy Barr (R-KY), the bipartisan legislation provides a technical fix critical to maintaining liquidity in the veteran home loan market and ensuring continued access to affordable VA mortgages.
Click here to view video of Congressman Scott’s remarks.
Text of Remarks
“Thank you very much, Chairwoman Waters. As has been previously mentioned in the Committee, last year we passed the banking regulation bill S. 2155. And in there, we included bipartisan reforms to refinancing requirements to veteran home loans to protect our veterans from the predatory practice of what is called loan churning. Now loan churning is this: that’s where the bad actors come in. And we do have bad actors and let me say we also have good actors in the loan business.
“But in this one, mortgage churning is so cruel. It is where bad actors in the mortgage refinancing industry come in and refinance these loans to our veterans over and over and over again. I can’t think of a more abusive and fraudulent manner than this. And we dealt with that in that bill. However, a technical error in the implementation timeline has caused a cohort of 2500 veterans’ loans to be ineligible for Ginnie Mae securitization and this causes a strain on liquidity. And furthermore, it boxes out these veteran loans from the secondary market opportunities.
“Our bill, H.R. 1988, is a bipartisan bill to correct this, and it will preserve critical VA refinancing protections for our veterans while at the same time allowing for these veteran loans to be securitized, which means rolled into securities into investments into market securities. That is it, plain and simple.
“And I want to thank my bipartisan cosponsors, Representatives Lee Zeldin, Mike Levin and Andy Barr. I also want to thank Chairwoman Maxine Waters for her leadership in our helping our veterans in this badly needed area.
“Now, ladies and gentlemen, we owe our veterans, our brave servicemembers, a great sense of gratitude. Let me just say, for those who may not know: we are losing 20 veterans every single day to suicide. I see this as a crying out for help and for us to focus attention. It is absolutely essential that we strengthen the veterans home loan market and preserve safe, affordable, and accessible borrowing opportunities away from deceptive marketing practices, away from fraud and abuse, like mortgage churning, for our brave and courageous active duty military personnel and our veterans. Thank you.”