WASHINGTON—The Defense Credit Union Council (DCUC) submitted a letter to the leadership of the Senate Subcommittee on Housing, Transportation and Community Development expressing its appreciation for the subcommittee’s attention to “housing innovation” in the face of an affordable-housing crisis—one that has particular ramifications for members of the military.
In its letter to Chair Katie Britt and Ranking Member Tina Smith, DCUC shared how the shortage of affordable homes greatly affects military families who move frequently and are often subject to high-cost areas surrounding bases. DCUC noted Basic Allowance for Housing (BAH) often fails to keep up with fast-rising local market rents, leaving military families to cover the difference out of pocket.
DCUC further said the high cost of housing also affects veterans, many of whom are on fixed incomes or disability benefits, leading some to be driven out of the communities they settled in after service due to unsustainable rent and interest-rate increases.
Undermines Readiness
“Simply put, when those who wore the uniform cannot find an affordable place to live, it not only harms their financial well-being but also undermines military mission readiness, recruitment and retention,” wrote Jason Stverak, DCUC’s chief advocacy officer.
Added DCUC President/CEO Anthony Hernandez, “If we want to maintain an all-volunteer force, we must ensure that those who serve can afford to live where they serve.”
Additional Points Addressed
The letter also addresses the low use of the VA Home Loan benefit, driven by the misperception that these loans are harder to close or involve delays, as well as bureaucratic issues such as slower appraisals. “These barriers leave veterans unable to use the benefits that they have earned,” DCUC said.
CU Solutions Being Offered
The organization noted that despite the hurdles, credit unions are implementing solutions to expand housing access and affordability, including:
• Specialized VA Home Loan Programs that streamline the process and reduce fees.
• First-Time Homebuyer Grants and Assistance that help young service members and their families with down-payment grants to bridge the gap.
• Financial Education and Housing Counseling that prepare service members and their families for the home-buying process via certified housing counselors.
• Leveraging the Federal Home Loan Bank Affordable Housing Program to provide subsidies for low- and moderate-income military homebuyers to cover critical needs such as closing costs, home repairs or gap financing.
• PCS Bridge Loans and Relocation Mortgages that assist military families when they receive orders to move, often before they are able to sell their current home or find a new one in their new location.
‘Beyond Banking’
The letter also focused on how credit unions go “beyond banking” to support housing stability, working within their communities to combat homelessness and improve housing conditions, especially for aging veterans.
The Recommendations
DCUC is recommending Congress:
• Raise the Credit Union Member Business Lending Cap for Housing Projects
• Expand Credit Unions’ Access to the Federal Home Loan Bank System
• Modernize Field of Membership Rules to Reach Underserved Areas
• Enhance and Promote the VA Home Loan Program
• Increase Basic Allowance for Housing (BAH) and Tie It to Real Market Costs
• Support Affordable Housing Initiatives in Military Communities
• Reduce Regulatory Burdens That Impede Mortgage Lending by Community Lenders
