VETERANS USE VA LOANS FOR CO-OPS IN NEW YORK CITY

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PASSAGE OF 2006 SCHUMER/MALONEY BILL ALLOWS VETS TO USE VA LOANS FOR CO-OPS

By Frank Lozano, VA Home Loan Specialist at DirectVALoan.com

Until now, NYC Veterans had no hope of owning a residence. VA Loans were only usable for houses, townhouses and condos. Most real estate in New York City are Co-op’s.

Sen. Charles Schumer (D-NY) and Rep. Carolyn Maloney (D-Manhattan, Queens), long-time champions of permitting VA Loans for Co-ops, back in 2006, hailed congressional action as a major win for NYC Vets.

Back in 2006, the Senate and House of Representatives passed legislation that included provisions to help give veterans, particularly veterans in New York City, greater housing choices.

S.3421, the Veterans Benefits, Health Care, and Information Technology Act, contains language originally introduced by Maloney and Schumer allowing veterans to use these VA loans to purchase cooperative housing.

Before the legislation, VA loans can be used to purchase a house, townhouse, condominium or even a mobile home, but not a co-op. “Without the option of cooperative housing, using VA loans wasn’t realistic for many veterans in New York City,” said Maloney back in 2006. “VA loans should be available for all types of housing – there is no reason New York City co-ops should be excluded. With this action, veterans in New York City and around the country will finally see their housing options expand. I commend Senator Schumer for his dedicated work on this issue in the Senate.”

“New York Veterans have been getting the short end of the stick when it comes to housing for far too long,” Schumer said back in 2006. “Until now the loans could be used for just about anything but co-ops, the majority of housing in New York city. The bottom line is those that fight for our country shouldn’t have to fight for a place to live. Our bill will open up those options, easing the burden on our heroes.”

Sen. Schumer first introduced the Senate version of the bill in 2001. He worked tirelessly for 5 years with his colleagues on the Banking and Veterans Affairs committees to achieve passage of this legislation. After providing testimony to the Veterans Affairs committee in June 2006, Sen. Schumer was able to successfully lobby to have the Veterans Housing Fairness Act (S.2121) included in Senator Craig’s Veterans’ Choice of Representation and Benefits Enhancement bill (S.2694) passed by the Congress on September 21, 2006.

This bill, including Schumer’s provision was included S. 3421, the Veteran’s Omnibus bill. Maloney first introduced her Veterans Housing Fairness Act in 1995, after learning that a constituent attempted to purchase a residential cooperative unit, but was told that his VA loan could not be used to buy the property. The most recent version, H.R. 4537, was introduced in December 2005.

The VA loan program allows veterans to buy homes with no down payment and limited closing costs; additionally, the program offers negotiable interest rates and flexible repayment plans. Extending these generous loan benefits to the purchasers of co-op apartments is a boon for New York Veterans.

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