The Department of Veterans Affairs just announced that it is asking mortgage servicers not foreclose on veterans and service members who are delinquent on their VA home loans until May 31, 2024. The VA’s action comes in response to an NPR investigation that discovered thousands of veterans who utilized a COVID forbearance program offered by the agency were at risk of losing their homes even though they had done nothing wrong.
The Partial Claim Payment program (PCP), set up by Congress in the midst of the pandemic, allowed borrowers to skip making mortgage payments for six or 12 months and offered those who used it an affordable way to resume making payments and deal with arrearages. For reasons that are unknown at this point, the VA allowed the program to expire in October of 2022. As a result of the unexplained lapse, more than 6,000 people are now in foreclosure and another 34,000 are delinquent.
In a letter dated November 15, 2023, Ohio’s Sherrod Brown and six other senators implored Denis McDonough, the Secretary of Veterans Affairs, to pause foreclosures until the VA developed and implemented a replacement for PCP that will enable veterans and service members to keep their homes and enter into affordable loan medication agreements with lenders.
The letter, combined with the disturbing findings in the NPR report motivated the Secretary to call a halt to existing and potential foreclosure actions for six months.
If you are a veteran or servicemember impacted by the end of the PCP program or are experiencing other problems related to a VA home loan, please contact DannLaw today by calling 216-342-9901 or completing our online contact form to arrange a no-cost consultation. It will be our honor and privilege to discuss your situation and assist you.
Thank you for your service, and remember, DannLaw is here to support the veterans and servicemembers who protect us and the USA.