VA Loan Updates

As a House subcommittee reviews expired and expiring veterans programs, veterans groups are urging the lawmakers to strengthen employment and re-employment rights programs, extend an option for adjustable-rate veterans' home loans, and restore a $100 cut in monthly payments for apprenticeships and on-the-job training. Although 13 programs are being re-evaluated, the one getting the most attention is a lapsed test program that had top government lawyers involved in resolving employment and re-employment rights complaints from federal workers who also serve in military reserve components. Under the test, the Office of Special Counsel, an independent federal agency, helped the Labor Department with employment rights cases. It ended with praise for the results but disagreement about whether the concept was worth continuing. The Labor Department says it doesn't need the help, while the Office of Special Counsel says there is much more to be done and wants to stay involved. Testifying in February before the House Veterans' Affairs economic opportunity panel, Charles Ciccolella, assistant secretary of labor for veterans' employment and training, said the test program that began in February 2005 had the Office of Special Counsel handle 312 claims by federal employees of violations of the Uniformed Services Employment and Re-employment Rights Act. That is about 7 percent of all complaints received by Ciccolella's office. He said the test improved the ability of federal investigators to look at what he described as "mixed" cases - complaints that involved potential violations of federal civil service laws as well as guarantees for employment and reinstatement. But he sees no reason to extend the program. "The demonstration project was useful and both agencies benefited from it," Ciccolella said. "However, the demonstration program has served its purpose, and we do not believe it should be reauthorized." U.S. Special Counsel Scott Bloch, however, said he thinks the independent investigators need to stay involved, even to the point of having exclusive authority over all complaints filed by federal employees. The OSC "obtained corrective action for service members in more than one in four of the claims filed with us and took less than 120 days on average to resolve cases," Bloch said. "The results of the demonstration project speak for themselves." He said OSC investigators already had experience dealing with federal personnel issues and noted that office also has the ultimate power to take a complaint to the federal Merit Systems Protection Board if a National Guard or reserve member is treated unfairly. And complaints will likely increase, Bloch said, with the nation "in the middle of the largest sustained military deployment in 30 years." "Right now, with returning war vets a comparative trickle, USERRA claims are in the hundreds," he said. "What will happen if and when that trickle turns into a flood?" Other expiring provisions under review by the subcommittee include a drop of more than $100 as of Jan. 1 in on-the-job training and apprenticeship payments; termination of a job-training program for incarcerated veterans; and a looming end to adjustable-rate mortgages as an option for homebuyers who use the veterans' home loan guaranty program. Felix Vargas Jr. of the American GI Forum, one of the veterans groups testifying before the subcommittee, said cutting on-the-job training payments from $935 to $825 was a mistake. "At a time when we see signs of an imminent recession in our country, it is important that we not lose sight of the contribution that this program makes in battling unemployment in a weakened economy," he said. Justin Brown of the Veterans of Foreign Wars said he hopes Congress makes permanent a test program that allows adjustable-rate mortgages under the veterans' home loan program. The VA program has caps that prevent interest rates from climbing more than 1 percentage point a year or more than 5 percentage points over the lifetime of the loan. Adjustable-rate mortgages "have proven to be very popular alternatives to conventional home financing," Brown said. "They typically offer a lower-than-normal initial interest rate, which may make it easier for our veterans to obtain affordable financing. Moreover, if interest rates drop, the homebuyer can save thousands of dollars above what they would pay using a conventional mortgage." If Congress doesn't act, VA will lose authority to guarantee ARMs on Sept. 30, officials said. Found here. Sphere: Related Content