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Housing Crisis
is Even Worse for Veterans
In Los Angeles,
houses are still priced drastically above the national average. Even foreclosed
properties are typically above the $329,000 median price range. Bank-Owned
properties, in their abundance, are appealing to Vets of all walks of life and
are now relying on their VA Loans to assist them in their purchase. Many men
and women who served in the Armed Forces have had to wait for a shift in the
housing market of recent magnitude to even consider owning a home in
California. However, Veterans participating in the VA Loan Program are being
systematically pushed aside by the banks who favor cash investors, while Real
Estate Agents representing these Veterans are discouraged from showing homes to
them at all, receiving the "obligatory eye roll" from Brokers and
Lenders with even a mention of the VA Loan Program.
To protect
veterans, the VA Loan Program comes with stringent requirements for disclosure
and inspection that could take up to 60 days. We have seen on several
occasions, a qualified and approved buyer participating in the VA Loan Program
places an offer at full price, in most cases the bank will accept the lower
offer made by a cash investor who simply wants to "flip" the house
and sell it for a profit. Once the house is "flipped," it will likely
fall out of a veteran's price range altogether. Of those "flipped"
homes that remain within a Veteran's reach, chances are that the seller will
prefer a conventional loan and weighty down payment. In both scenarios, the
Veterans and their families remain without a home.
When Vets
returned from World War II, they helped to build the San Fernando Valley's
businesses and neighborhoods that exist today. Back then, new housing
developments announced enthusiastic invitations to Vets, and their brochures
exclaimed things like, "Calling all Vets! Move in with Nothing
Down!" Lending programs extended to those who served this country
gave them preferential treatment at every opportunity. There were literally
thousands of new homes to choose from, and Vets could take their pick. Today,
the San Fernando Valley is littered with thousands of foreclosures; these same
homes continue to sit empty and in various stages of disrepair, subject to
vandalism and other crimes decreasing neighborhood values. The limited number
of them that will pass a VA Inspection are priced 20-30 times higher than when
they were brand new, and despite offers to pay full price, a Veteran loses to a
cash investor who offers less on almost every occasion. What is wrong with this
picture?
Activist and
REALTOR, William Preston Bowling has decided to Propose Legislation that will
apply to Bank-Owned properties in California. Bowling, the 2009 President of
the Malibu Association of REALTORS will go on to serve as 2011 Chair of the
California Association of REALTORS (Region 17) and as an active member of
several Real Estate Legislative Committees, feels he can have a major impact on
the outcome of this proposed legislation, with high hopes that this will level
the playing field and assist Veterans having their offers on Bank-Owned
properties accepted.
The proposed
legislation reads as follows: "...
Purchase Agreement
offers from Veterans participating in VA Loan Programs will take priority over
any non-owner occupied offer, if the VA offer is equal to, or greater than the
investor's offer, on all California Bank-Owned properties
" The result will
likely have far-reaching positive impact as Veterans and their families will be
able to purchase homes. Banks will receive equal or more money for the home
than a cash investor hoping to flip the house for profit will offer. This will
also contribute to an increased value of properties within neighborhoods, and
help to reduce crime rates that tend to rise when neighborhoods consist of
vacant houses. Statistically, empty homes face an increased risk of vandalism
and fire, and drug-use within the community.
With this
legislation in place, Veterans - many of whom are poised to return home from
the war - will have an opportunity to own homes alongside those whom they have
served to protect. Bowling is also making a
documentary about this process, from the inception of his idea about his
Proposed Legislation to its passing into law.
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