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VA Home Loan Foreclosures Paused For 6 Months

The Department of Veterans Affairs has announced a six-month pause in foreclosures to help military members avoid losing their homes in the wake of financial hardships brought on by the global COVID-19 pandemic.

The VA has contacted its participating lenders, asking them to delay taking foreclosure action on VA home loans as a crucial VA foreclosure avoidance program is extended to help prevent veterans from losing their houses.

Related: Avoiding Foreclosure on a VA Mortgage

Veterans Assistance Partial Claim Program Sunset

The VA Veterans Assistance Partial Claim Payment program started in the summer of 2021, has ended. It intended to allow qualifying VA borrowers to delay paying up to a year’s mortgage payments during the pandemic. The VA has created a program (see below)

As you might have guessed, the sunset of that program created new problems for some VA borrowers who had come to rely on the help as they recovered from financial hardships related to the pandemic.

Regular payments under this program would resume once the borrower was financially stable, with the “skipped” payments added to the end of the loan term.

This VA program ended in the fall of 2022, but the fallout from its end was severe enough to warrant an investigation by National Public Radio, which multiple sources report uncovered some six thousand veterans in danger of losing the homes they purchased with VA loans.

Those six thousand looming foreclosures came once the partial claim program ended in 2022. Well over 30 thousand additional veterans face VA loan delinquency in the wake of the partial claim program’s end.

Something clearly needed to be done to help the veteran population still trying to recover from the pandemic without losing their homes.

What Happens With VA Home Loans Now?

If you are in trouble with your VA mortgage, there may be help available through an ongoing program (at press time) to help VA borrowers. The COVID-19 Refund Modification program was created to help VA borrowers who are unable to recover financially from the pandemic.

The program was initially set to end on December 31, 2023. It is now extended through May 31 2024. There are also discussions of creating a VA Servicing Purchase program designed to let the VA buy defaulted VA loans from the lender, but those plans are not implemented at press time.

What To Do

VA borrowers who need help with their mortgages in the wake of pandemic-related financial hardship should contact the VA directly at 1-800-827-1000 and call their participating lender to discuss their needs.

Borrowers should ask the VA and their lender about the VA loan modification option offered to qualifying applicants under this program. You may be offered a zero-interest, deferred-payment loan from the VA to cover missed payments. You may also be eligible to modify an existing VA mortgage loan.

Remember, you can’t get help on your home loan without the lender’s participation. Be sure to coordinate with your participating lender at the first sign you have financial difficulty. The longer you wait, the fewer your options are.



About the author


Editor-in-Chief Joe Wallace is a 13-year veteran of the United States Air Force and a former reporter/editor for Air Force Television News and the Pentagon Channel. His freelance work includes contract work for Motorola, VALoans.com, and Credit Karma. He is co-founder of Dim Art House in Springfield, Illinois, and spends his non-writing time as an abstract painter, independent publisher, and occasional filmmaker.