Dear Editor:

Service Officer Terry Tracy, located at The American Legion Rehabilitation Division in Los Angeles, reports veterans with conventional home loans now have new options for refinancing to a Department of Veterans Affairs guaranteed home loan. These new options are available as a result of the Veterans’ Benefits Improvement Act of 2008, which was signed into law last October. Veterans in financial distress due to high rate sub prime mortgages are potentially the greatest beneficiaries.

The VA has never guaranteed sub prime loans. However, as a result of the new law the VA can now help many more veterans who currently have sub prime loans. The new law makes changes to the home loan refinancing program, and veterans who wish to refinance their sub prime or conventional mortgage may now do so for up to 100% of the value of the property. Additionally, Congress raised VA’s maximum loan amount for these types of refinancing loans, which were previously capped at $144,000. With the new legislation, such loans may be made up to $729,750 depending on where the property is located. Increasing the loan-to-value ratio and raising the maximum loan amount will allow even more qualified veterans to refinance through the VA, allowing for savings on interest costs or even potentially avoiding foreclosure.

The California Department of Veterans Affairs and its Cal Vet Home Loan program is committed to helping veterans and active duty personnel to attain the American dream of home ownership. For more information, or to obtain help from a VA Loan Specialist, veterans may call the VA at 1-800-827-3702. The “hope” hotline, 1-800-995-HOPE (or www.995hope.org) provides free mortgage counseling 24 hours a day, seven days a week.

Margaret L. McIntosh, San Gabriel