VA would offer veterans loans to build rural homes

The VA would make direct loans to eligible veterans to buy rural land and build homes. The veteran must buy land in a rural area and own and occupy the new home as a primary residence. Veterans must meet income, credit, and property standards, and the loan cannot exceed the home’s reasonable construction value. The veteran must use the supplied blueprints and live in the home as a primary residence for at least 24 months after construction. The loan would carry 1% interest. The bill authorizes $5 million for fiscal year 2027, available until spent, but does not say the pilot waits for that funding. The VA must start the pilot within 180 days after enactment and may make new loans for five years after enactment.

State and local governments would have to issue certain construction permits within 45 days, and the VA would pay the permit fee. This applies to state and local governments that receive applications to build using the pilot’s blueprints. The deadline and fee payment apply to permit applications that use blueprints furnished under the pilot. The blueprints must use domestic lumber for structural framing; domestic wood products for other parts of the home are required only to the maximum extent practicable, as the VA determines. The permit deadline is 45 days after the government receives the application.

The VA would provide technical help to veterans who receive a pilot loan. This applies to veterans who receive a loan under the pilot program. The help may include training in home construction or repair and help applying for a construction permit.

The VA would make the full unpaid loan balance, including accrued interest, immediately due if a veteran transfers or leases the home, or lets someone else occupy it as a primary residence, before the required occupancy period ends. This applies before the veteran completes 24 consecutive months of living in the home after construction. The VA may waive acceleration if the veteran shows the early sale, transfer, or lease resulted from military deployment or a permanent change of station, a documented medical hardship, or another unavoidable circumstance consistent with the pilot’s purposes. The VA must give written notice of its decision and the date the loan balance becomes due. The rule applies any time before the 24-month occupancy period is complete.

The bill would replace June 9, 2034, with June 12, 2034, wherever the earlier date appears in the veterans’ home-loan fee table. This applies to the date or dates in the fee table for certain home loans under federal veterans’ housing law.