Rep. Mike Levin Reintroduces Bipartisan Bill to Waive Home Loan Fees for Disabled Veterans
Washington, D.C. — Today, Rep. Mike Levin (CA-49) and Rep. James Moylan (Guam-At Large) reintroduced the Veterans Assistance for Loan Origination Relief (VALOR) Act, H.R. 7598, to make Veterans Affairs (VA) home loans more accessible by waiving fees for disabled veterans.
VA home loans play an essential role in helping service members and veterans achieve homeownership. For veterans with service-connected disabilities, who often encounter additional challenges in buying a home, the VA provides funding fee waivers. However, under current rules, the waiver is granted only if the veteran’s disability rating has been officially issued before the loan’s closing date. This means that transitioning service members and veterans who have submitted a disability compensation application or their intent to file before closing, but have not yet received their official disability rating, are not eligible for the fee waiver. The VALOR Act would fix this.
“Disabled veterans are not supposed to pay fees when they get a VA home loan. However, many of our veterans who take longer to receive a disability rating are still paying these burdensome fees, which can be a barrier to homeownership,” said Rep. Levin. “The VALOR Act modernizes the VA home loan fee structure and would reimburse veterans and transitioning service members who pay fees and later receive a disability rating and compensation. By correcting this loophole, the bill helps ensure disabled veterans and service members leaving the military can begin their civilian lives on stronger financial footing and buy quality, affordable homes. I thank Rep. Moylan for his partnership on this bill and look forward to it moving quickly through the legislative process.”
The VALOR Act would require the VA to reimburse a veteran or transitioning service member for the cost of the home loan funding fee if they submit a disability claim or a notice of intent to file, pay the home loan fee, and later receive a disability rating and begin receiving disability compensation for that claim. Under the bill, any funding fee paid by a veteran who qualifies under these circumstances would be classified as an overpayment, placing the responsibility on the VA to issue reimbursement to the veteran.
“I’ve heard personally from veterans who were proud to finally be in a position to buy a home, only to learn later that they’d been charged a fee they never should have owed. It’s frustrating, and it’s unnecessary,” said Congressman Moylan. “These are men and women who served our country, followed the process, and still ended up paying more because their disability rating came through after the fact. That’s a gap in the system, and it’s one we can fix. I’m proud to co-lead the VALOR Act with Congressman Mike Levin to ensure that our veterans aren’t penalized for administrative delays and that their benefits reflect the service they’ve given.”
The bill is endorsed by the American Legion, National Association of Realtors, Veterans Association of Real Estate Professionals, Association of Independent Mortgage Experts (AIME)/Broker Action Coalition, and the Veterans of Foreign Wars.
“The National Association of REALTORS® thanks Representatives Levin and Moylan for their bipartisan leadership in introducing the VALOR Act to strengthen housing opportunities for America’s veterans. This important legislation would ensure that veterans with pending disability claims are not unfairly burdened by loan fees. By removing unnecessary financial barriers, the VALOR Act helps make the path to homeownership more affordable and equitable for those who have served our country," said Shannon McGahn, NAR Chief Advocacy Officer and Executive Vice President.
“The VALOR Act helps ensure veterans are refunded the VA funding fee when a disability claim pending at closing is later approved,” said Son Nguyen, Founder & National President of Veterans Association of Real Estate Professionals. “As a Veteran Service Organization and HUD-Approved Housing Counseling Agency, we support policies that protect veterans from being financially disadvantaged due to administrative timing. This legislation strengthens fairness and confidence in the VA home loan benefit.”
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