I recently had the profound honor of helping to hand-wash the Vietnam Veterans Memorial in Washington, D.C., a deeply moving experience that allowed me to pay homage to my fellow servicemembers and Naval Academy classmates who served in one of the longest wars in American history.
Standing alongside Jan Scruggs, the visionary behind the memorial and founder of the Vietnam Veterans Memorial, I reflected on the legacy of courage and sacrifice shared by our Veteran community. It served as an important reminder of our obligation as a nation to make every effort to repay the debt of gratitude owed to those who fought to protect our freedoms.
This is why helping my fellow Veterans achieve the American dream of homeownership is my driving mission. Owning a home offers security and greater financial stability, along with a sense of community that is essential to military families. It’s considered by many to be the pinnacle of achievement and prosperity — and frankly, if anyone deserves to achieve the dream of homeownership, it’s our nation’s Veterans.
Unfortunately, recent national research found that younger active-duty servicemembers are significantly less likely to own a home than their civilian counterparts. These younger servicemen and women often face difficulties navigating the homebuying process, particularly around paying closing costs.
Two key factors contribute to this disparity: a lack of knowledge about the VA benefits to which they are entitled, and a limited understanding among sellers and lenders of the strong buyer profile of VA loan borrowers.
It’s important to take a moment to look back at the history behind VA benefits. In 1944, the U.S. Department of Veterans Affairs established the VA lending program as part of the Servicemen’s Readjustment Act (later renamed the GI Bill), so that returning World War II Veterans had access to education, unemployment, and housing assistance. The housing benefits have been instrumental in securing more than 28 million home loans for Veterans over the last 80 years.
However, through my daily interactions with the Veteran community, I have seen firsthand that many of today’s servicemen and women are unaware of the VA benefits they’ve earned, including lower interest rates, reduced insurance costs, and lower down payment requirements than conventional loans.
Compounding the problem, the number of financial institutions servicing home loans for Veterans has declined, leaving Veterans with fewer options to obtain a mortgage. Additionally, not all of the remaining lenders have sufficient expertise in military benefits, compensation, and pension structures, which could lead them to prematurely reject military homebuyers who don’t fit into the traditional credit evaluation process.
These institutions can also make misguided judgements about Veterans’ and active-duty servicemembers’ credit histories without realizing that their credit scores may have been impacted by unexpected deployments or the need to frequently relocate. But Veterans and their families are defined by much more than just their credit scores and deserve more nuanced consideration of their unique circumstances when making lending decisions.
Veterans and active-duty servicemembers shouldn’t face unnecessary obstacles when purchasing a home. As mortgage industry leaders, we must all do our part to make the process as clear and straightforward as possible. This includes educating ourselves about the benefits available to military homebuyers, as well as supporting opportunities to help the servicemembers themselves learn more about their entitled benefits, such as through robust awareness programs, proactive outreach, and broader collaboration with our partners at government agencies and local and national Veterans organizations.
Our nation’s heroes deserve better. We must do more starting now and each day moving forward to ensure every Veteran has the opportunity to build fulfilling lives in their dream homes for themselves and their families.
Rear Admiral Thomas Lynch is the executive chairman of NewDay USA, a VA home mortgage company serving active servicemembers and military Veterans. He retired from the U.S. Navy after a distinguished 31-year career.
