VA Loan Rate Hiked to 9.5%

The Veterans Administration announced today it was raising its maximum interest rate on federally backed VA mortgages a full percentage point to 9.5%, the first increase in this rate in two years.

The VA said that it was making the change to bring its rate more in line with the mortgage market, which has been moving up in recent weeks. The change will take effect on Monday. In the past three years, the VA has lowered its mortgage rate 15 times, with the last cut occurring on Jan. 16, when the rate was reduced to 8.5%, the lowest level in nine years.