Omnibus veterans legislation passed by Congress includes provisions offered by U.S. Senators Daniel K. Akaka (D-Hawaii) and Jim Jeffords (R-VT) that continue the eligibility of members of the National Guard and Reserve for the Department of Veterans Affairs [VA] Home Loan Guaranty Program.

The omnibus bill, H.R. 2116, extends reservists' eligibility for VA-guaranteed home loans through fiscal year 2007. Senator Akaka is the author of the original legislation in 1992 extending eligibility for the VA Home Loan Guarantee Program to National Guard and Reserve members who complete six years of service. In 1998, Akaka successfully proposed an amendment continuing these service members' participation in the program through December 2003. Akaka's long-term goal is to make reservists' eligibility for the program permanent.

The VA guaranty program is an important component of a benefits package making Guard and Reserve service more attractive to qualified individuals. Permanent authorization will assist the National Guard and Reserve with their recruitment efforts by allowing veterans housing loans to be offered as an incentive.

"The VA Home Loan Guaranty Program to National Guard and Reserve members is a resounding success and important recruitment tool," Akaka noted. "Thousands of dedicated reservists have been able to fulfill the dream of home ownership through this program."

To qualify, reservists must serve for at least six years, and continue to serve or have received an honorable discharge. Participation of Guard and Reserve members not only benefits these service members, but also stabilizes the financial viability of the program since this group has had a lower default rate than most other program participants. Currently, the VA Home Loan Guaranty Program cannot be used as a recruitment tool since its authorization expires in four years and reservists are required to serve at least six years before they qualify for VA-guaranteed loans.

"Since the end of the cold war, we have significantly downsized our active duty military forces, and as a result, the National Guard and Reserve have a more prominent role in the Total Force," Akaka noted. "Reservists are being increasingly called upon to protect and promote our national security interests in regions throughout the world. Continued participation in the veterans housing loan program acknowledges the vital service to our country by the Select Reserve."