Washington, D.C. – U.S. Representative Colleen Hanabusa (HI-01) today requested that the Veterans Administration review the limits it has set on VA loan guaranties for Honolulu. Guaranty limits for Honolulu have been set at $625,000 for 2014, a reduction of 17% from the 2013 limit of $750,000.
VA loan guaranties help Servicemembers, veterans, and their families achieve home ownership. The loans are provided by private lenders, such as banks and mortgage companies, with the VA guaranteeing a portion of the loan, enabling the lender to provide borrowers with more favorable terms.
In a letter to Secretary of Veterans Affairs Eric Shinseki, Hanabusa said, “This proposed reduction accounts for a 17% cut to the guaranty limit, and will substantially impact a county where housing prices rose nearly 7% over the past year. In addition, I question whether it is appropriate to set a limit in Honolulu that is the same as other areas in Hawaii, as Honolulu has been cited as having the second highest cost of living in the country, after New York City.”
“The announced 2014 VA Loan Guaranty limit in Honolulu will have an adverse effect on veterans trying to secure home ownership, a tenet of the American dream,” Hanabusa continued, “resulting in higher financing rates and larger down payments. In light of that, I would like to ensure that the current guaranty limits reasonably advance the VA’s mission of helping Servicemembers, veterans, and their families buy, repair, retain or adapt homes for their personal occupancy.”
Hanabusa concluded, “We owe it to the men and women who served honorably in our military to provide excellent care and services. This is one of the most important missions of our nation. Therefore, I am requesting further review be conducted on the impacts of reducing the 2014 loan guaranty in Honolulu County.”
Submitted by the office of Rep. Colleen Hanabusa.