Good afternoon.   Madame Chairwoman, you have chosen an especially timely topic for today’s hearing.

Every day, the media reminds us of the difficulties facing our national economy because of the subprime mortgage crisis.  It is clear from reading today’s testimony that America’s veterans, regardless of whether they have a subprime mortgage or not, whether they are current in their payments or not, will be affected in some way by this financial mess.

It is also clear from our witnesses’ statements that there is plenty of blame to go around.  It appears that every level of our national economic structure has played a role in allowing this to happen.  It would be too easy to blame just the borrowers who fooled themselves into believing they would never be faced with increased payments.  Or the lenders and brokers who encouraged such behavior with highly speculative mortgage products.  Or big investors and Wall Street financial services giants who appear to have demanded increasingly risky transactions.  I guess you could say there was enough greed to go around.

So, the question before us today is what can VA do to help veterans stuck in this mess?  Under current law, their options are limited.  But we must be careful here.  VA wisely has maintained its underwriting standards and as a result, taxpayers are not seeing their funds wasted.  The VA guaranty program is solvent and does not reflect the difficulties in the subprime market.    As we will hear from our witnesses, the mortgage business is very complex, with multiple levels of markets, borrowers, lenders and investors and the potential for negative unintended consequences is significant.  I want to work with you to keep the VA program stable and financially viable so that tomorrow’s veterans will benefit just as yesterday’s and today’s have.

I look forward to any suggestions our witnesses may have to ease this situation.