New VA Home Loan Program Saving Millions of Veterans Homes

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WAUSAU, Wisconsin (WSAW) – Thousands of homes owned by veterans and their families are at risk of foreclosure due to the COVID pandemic. We just announced a broad government-wide effort to help homeowners keep their homes while facing economic challenges.

A major new VA home loan program will help save the homes of an estimated 2.3 million veterans affected by COVID-19. This newly announced COVID-19 reimbursement modification option is only available until September 30, 2021.

“The COVID-19 reimbursement change offers veterans a sustainable and affordable solution to keeping their homes and avoiding foreclosure,” VA Secretary Denis McDonough said. “As our country recovers and rebuilds itself from the economic devastation caused by the pandemic, VA and the Biden-Harris administration continue to do everything possible to help veterans keep a roof over their heads as they are getting back on their feet. “

In some cases, veterans may qualify for a 20% payment reduction – in others, the reduction may be even greater.

As with VA’s COVID-19 partial claim option, the veteran’s deferred debt of a Covid-19 repayment modification will be established as a junior lien. The junior lien will not accrue interest, require monthly payments, and will only become due when the property is sold, the secured loan is paid off, or the secured loan is refinanced.

As part of the COVID-19 reimbursement amendment, the VA purchases a veteran’s past due payments and outstanding principal amounts, based on the assistance required, subject to certain limits. The loan managers also modify the loan. These efforts help ensure that the veteran can afford future mortgage payments.

The VA home loan program:

  • Supports at least 25% of most loans, eliminating the need for a down payment and PMI.
  • Can be used while on active duty or after six years of service in the National Guard or Reserve.
  • Can be used more than once.
  • Offers direct, loan-to-use financing on over 100 U.S. tribal lands and territories.

To learn more about this new option, visit the VA Home Loan Program or call 877-827-3702.

The new VA Partial Claim Program is a temporary program, which will update some borrowers on their mortgage when they resume regular mortgage payments, will remain in effect until October 28, 2022. The requirements are:

  • The loan must be a loan guaranteed by VA
  • VA loan must have been less than 30 days outstanding or past due as of March 1, 2020, or created on / after March 1, 2020
  • Borrower must have received COVID-19 forbearance and missed at least one payment under the terms of the original mortgage note
  • The borrower must currently occupy the property securing the secured loan as a residence
  • The borrower has recovered from the difficulties and can resume making full monthly payments on time under the terms of the original mortgage note
  • The borrower agrees to repay the partial claim amount to VA and allow VA to create a second mortgage lien on the property

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