VA Home Loan Program Reform Act
Sponsored By: Representative Van Orden
Became Law
Summary
Prevent veteran foreclosures by expanding VA loss-mitigation powers and adding a Partial Claim Program to keep struggling borrowers in their homes. It also raises funding for homeless-veteran services and orders a report on real-estate access.
Show full summary
- Veterans and borrowers: Allows the VA Secretary to pay lenders to stop foreclosure, require document execution and forbearance, and makes those loss-mitigation decisions final and not reviewable in court.
- Lenders and servicers: Authorizes a Partial Claim that can buy up to 25% of unpaid principal, or 30% for borrowers who missed payments between March 1, 2020 and May 1, 2025. The VA may require loan holders to take steps to establish the claim, compensate them for services, and perform random post-payment audits.
- Homeless-veteran services and market access: Boosts authorized funding for Comprehensive Service Programs for Homeless Veterans and requires a report within 90 days on ensuring veterans are not disadvantaged in obtaining real-estate representation.
*Increases federal spending by authorizing $344 million for each of FY2025 and FY2026 and $257.7 million annually through FY2030 for homeless-veteran services.*
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Bill Overview
Analyzed Economic Effects
3 provisions identified: 3 benefits, 0 costs, 0 mixed.
New partial claim for VA loans
The law creates a Partial Claim Program for VA‑backed mortgages on a primary home that are in default or at risk. VA can pay part of what you owe and take a junior lien; the money first covers missed payments, taxes, insurance, and dues. The payment is capped at 25% of the unpaid principal, or 30% if you missed a payment between March 1, 2020 and May 1, 2025; you usually get one claim per loan, with a second allowed after a Presidentially declared major disaster or within 120 days after it. VA may make new partial claims for five years after enactment. If you later default, you owe VA for its loss and your guaranty entitlement may be reduced. VA decisions on partial claims are final and not reviewable in court.
Stronger foreclosure help rules for VA loans
The law expands VA’s power to stop foreclosures on VA‑backed loans. VA can pay lenders to avoid foreclosure, require forbearance, and make lenders complete needed paperwork. VA must set a required sequence of loss‑mitigation steps lenders must offer, and VA cannot buy your whole loan until you complete that sequence. VA can set processing standards, use holder certifications, and run post‑payment audits. VA decisions under these foreclosure‑help tools are final and not reviewable in court.
More funds for homeless veteran services
The law authorizes $344 million for each of fiscal years 2025 and 2026 for programs serving homeless veterans. It authorizes $257.7 million each year after that through 2030. These funds support housing, treatment, and case‑management services for veterans experiencing homelessness.
Sponsors & CoSponsors
Sponsor
Van Orden
WI • R
Cosponsors
There are no cosponsors for this bill.
Roll Call Votes
No roll call votes available for this bill.
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