In a decisive move to protect veterans and servicemembers with VA Loans, the Department of Veterans Affairs (VA) has instituted a six-month freeze on foreclosures. This proactive decision, spurred by an investigative report from NPR, aims to shield thousands of veterans facing the looming threat of losing their homes through circumstances beyond their control.
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VA’s Commitment to Keeping Veterans in Their Homes
Highlighting the significance of supporting veterans and their families, VA Press Secretary Terrence Hayes emphasized, “Helping Veterans and their families stay in their homes is a top priority at VA.” This commitment has translated into a compelling directive to mortgage servicers, mandating a freeze on foreclosures for VA-guaranteed loans until May 31, 2024.
Unraveling the Forbearance Dilemma
Against the backdrop of the COVID-19 pandemic, Congress introduced a forbearance program designed to assist individuals experiencing income loss. Initially offering a temporary halt on mortgage payments for six or 12 months, the program provided a lifeline for homeowners to regain financial stability. However, in a pivotal move in October 2022, the VA terminated a critical aspect of the program, leaving veterans without an affordable means to catch up on mortgage payments.
Urgent Senate Plea
After NPR brought attention to the impending crisis, a group of senators, including Sherrod Brown, Jon Tester, Jack Reed, and Tim Kaine, penned a letter urgently urging VA Secretary Denis McDonough to immediately halt foreclosures. They underscored that the dire situation was never the intent of Congress when establishing pandemic-related measures.
VA’s Innovative Approach
In response to the growing crisis, the VA announced a foreclosure pause essential for continuing assistance while launching their latest home retention option. This innovative approach involves the VA purchasing loans from current holders, modifying them, and managing them within a VA-owned loan portfolio. VA Press Secretary Terrence Hayes expressed confidence in this strategy, stating, “This will empower us to work with Veterans experiencing severe financial hardship to adjust their loans – and their monthly payments – so they can keep their homes.”
Josh Jacobs, the VA’s Under Secretary for Benefits, emphasized the agency’s dedication to veterans facing financial challenges. He encouraged struggling veterans to explore available resources by visiting VA housing assistance or calling 877-827-3702. In a separate statement, Jacobs reassured veterans that the VA would exhaust every available avenue to ensure they can retain their homes, underscoring the agency’s unwavering commitment to their well-being. This decisive move by the VA not only protects homes but also exemplifies a dedication to the principles set by Congress for the benefit of those who have served our nation.