House Panel Rejects Reagan’s Call for Higher Fees on VA Home Loans

A House committee voted Thursday to reject President Reagan’s call for sharply raising fees on new VA home loans and to add $716 million to the White House budget proposal for the Veterans Administration.

The House Veterans Affairs Committee, in a report to the full budget committee, recommended increased spending on VA medical care, including an added $30 million to treat veterans with AIDS in the next fiscal year.

The panel also voted to send to the House a resolution stating the opposition of Congress to Reagan Administration spending recommendations that would eliminate money to care for certain categories of middle-income veterans.

“Unlike the President’s budget, we have recognized that the veteran population is getting older and that as they get older, they will seek care more often and they will require longer lengths of stay,” said the panel’s chairman, Rep. G. V. (Sonny) Montgomery (D-Miss.).

Reagan’s Budget Proposal

Reagan’s $27-billion budget proposal for the VA, the largest of the independent federal agencies, included a provision that would raise the fee for home buyers under the VA mortgage guarantee program from 1% to 2.5% of the loan.

Critics said that would more than double the amount of cash veterans must have when they get a VA loan and decrease the attractiveness of the program to veterans.

The committee’s proposal would keep the fee at 1% and require an additional $411 million in outlays to cover revenues anticipated by the fee increase in the President’s budget.