President Trump last week signed into law a bill that allows the Secretary of Veterans Affairs to take actions to help veterans keep their homes following the recent end of the Veterans Affairs Servicing Purchase Program.
VASP was launched last year by the Department of Veterans Affairs to help more than 40,000 veterans experiencing severe financial hardship avoid foreclosure and stay in their homes, but the program was rescinded in May. The newly enacted VA Home Loan Program Reform Act [H.R. 1815] gives the department the ability to continue to provide aid for veterans facing foreclosure through the existing VA Home Loan Program. The bill does three things:
- It authorizes the VA to pay the holder of a VA-guaranteed loan an amount necessary to avoid the foreclosure of the loan, provided that the loan holder and the veteran obligated on the loan execute documents to ensure the VA obtains a secured interest in the property.
- It establishes a five-year Partial Claim Program under which the VA may make a partial claim (purchase a portion of the indebtedness) on VA loans for primary residences that are in default or at imminent risk of default.
- It requires the VA to report to Congress on its strategy to ensure that veterans who purchase homes under the VA home loan program are not at a disadvantage when attempting to secure representation by a real estate agent or broker.
