Last night, the Senate passed Sen. Herb Kohl’s legislation that would help 600 more veterans in Wisconsin receive low-interest home loans by increasing the state’s volume of tax-exempt mortgage bonds to $100 million. The provisions were included in a larger veteran’s tax relief package approved by the Senate.
“This Memorial Day, as we commemorate the men and women in our armed services who made the ultimate sacrifice, it is essential we honor our veterans with real actions of gratitude, not kind words alone,” Kohl, D-WI, said. “Many veterans from Wisconsin who have bravely served our nation face great difficulties affording a home and providing for their families."
Currently, Wisconsin, Alaska, Texas, Oregon and California have the ability to issue federally tax-exempt bonds, the proceeds of which are used to finance low-interest mortgage loans to veterans. In 2006, Congress eliminated the pre-1977 active duty requirement for veterans in the state and reduced the financing window for those individuals to 25 years for Wisconsin, Oregon and Alaska. But Congress dramatically reduced the bond volume-limit for these three states, capping it to $25 million.
While the expanded program eligibility has helped the Wisconsin Department of Veterans Affairs and the other states’ veteran service agencies reach a broader group of individuals, the lower bond caps hampered their ability to assist veterans with low-interest financing. Last year, Kohl introduced bipartisan legislation to correct this problem by raising the state volume cap limits in Wisconsin, Alaska and Oregon.
Once enacted, Kohl’s measure would increase the volume cap for these bonds in these states from $25 million to $100 million. The Qualified Veterans Mortgage Bond program has been a critical tool for veterans seeking financing to purchase a home, especially given the current credit crisis and instability in the housing market.
On Tuesday, the legislation, as part of the larger relief package, was passed unanimously by the House of Representatives. The legislation now goes to the President’s desk.