VA loans still strong in turbulent times

by Ryan Smith07 Feb 2017
Many are predicting that 2017 will be a rough year for the mortgage industry, and the seesawing rates of the last couple of months seem to give at least some credence to that prediction. But there may be one island of stability in the industry’s sea of troubles – the VA loan program.

The VA program saw its biggest year ever in 2016, according to a report in the US Finance Post. Loan volume nearly doubled from five years before, with the VA backing more than 707,000 loans.

And homeownership among veterans is looking good – especially compared to the wider public. The national homeownership rate has fallen to below 63%, a half-century low. Meanwhile, according to VA estimates, the homeownership rate among veterans is around 82%.

The of VA loans has also remained high. VA loans have had a lower foreclosure rate than both FHA-backed loans and conventional loans for 25 of the last 35 quarters, according to data from the Mortgage Bankers Association. This despite the fact that last year the average VA buyer had a FICO score nearly 50 points lower than the average conventional buyer, the Post reported.