Title 38Veterans' BenefitsRelease 119-73

§3726 Withholding of payments, benefits, etc.

Title 38 › Part PART III— - READJUSTMENT AND RELATED BENEFITS › Chapter CHAPTER 37— - HOUSING AND SMALL BUSINESS LOANS › Subchapter SUBCHAPTER III— - ADMINISTRATIVE PROVISIONS › § 3726

Last updated Apr 6, 2026|Official source

Summary

Federal agencies may not take or hold back a veteran’s or a surviving spouse’s federal payments (except VA benefit payments) to cover a debt linked to a VA loan unless the Secretary first sends the person a certified-mail notice (with return receipt) saying the Secretary can waive the debt under section 5302(b). If the Secretary does not cancel the whole debt, the Secretary must decide if the person should be released under section 3713(b). If the Secretary decides not to release them, the Secretary must tell the person and explain how to appeal, unless that notice and appeal information was already given.

Full Legal Text

Title 38, §3726

Veterans' Benefits — Source: USLM XML via OLRC

(a)No officer, employee, department, or agency of the United States shall set off against, or otherwise withhold from, any veteran or the surviving spouse of any veteran any payments (other than benefit payments under any law administered by the Department of Veterans Affairs) which such veteran or surviving spouse would otherwise be entitled to receive because of any liability to the Secretary allegedly arising out of any loan made to, assumed by, or guaranteed or insured on account of, such veteran or surviving spouse under this chapter, unless the Secretary provides such veteran or surviving spouse with notice by certified mail with return receipt requested of the authority of the Secretary to waive the payment of indebtedness under section 5302(b) of this title.
(b)If the Secretary does not waive the entire amount of the liability, the Secretary shall then determine whether the veteran or surviving spouse should be released from liability under section 3713(b) of this title.
(c)If the Secretary determines that the veteran or surviving spouse should not be released from liability, the Secretary shall notify the veteran or surviving spouse of that determination and provide a notice of the procedure for appealing that determination, unless the Secretary has previously made such determination and notified the veteran or surviving spouse of the procedure for appealing the determination.

Legislative History

Notes & Related Subsidiaries

Editorial Notes

Amendments

1997—Pub. L. 105–33 designated existing provisions as subsec. (a), substituted “unless the Secretary provides such veteran or surviving spouse with notice by certified mail with return receipt requested of the authority of the Secretary to waive the payment of indebtedness under section 5302(b) of this title.” for “unless (1) there is first received the consent in writing of such veteran or surviving spouse, as the case may be, or (2) such liability and the amount thereof was determined by a court of competent jurisdiction in a proceeding to which such veteran or surviving spouse was a party.”, and added subsecs. (b) and (c). 1991—Pub. L. 102–83 renumbered section 1826 of this title as this section. 1989—Pub. L. 101–237 substituted “Secretary” and “Department of Veterans Affairs” for “Administrator” and “Veterans’ Administration”, respectively. 1981—Pub. L. 97–66 struck out subsec. (a) which provided that the Administrator could not, unless the Administrator had first obtained the consent in writing of an individual, set off against, or otherwise withhold from, such individual any benefits payable to such individual under any law administered by the Veterans’ Administration because of liability allegedly arising out of any loan made to, assumed by, or guaranteed or insured on account of, such individual under this chapter, and struck out designation “(b)” before “No officer, employee, department, or agency of the United States”. 1976—Subsec. (a). Pub. L. 94–324 substituted “the Administrator” for “he”. Subsec. (b). Pub. L. 94–324 substituted “surviving spouse” for “widow” wherever appearing.

Statutory Notes and Related Subsidiaries

Effective Date

of 1997 Amendment Pub. L. 105–33, title VIII, § 8033(c), Aug. 5, 1997, 111 Stat. 669, provided that: “The

Amendments

made by this section [amending this section and section 5302 of this title] shall apply with respect to any indebtedness to the United States arising pursuant to chapter 37 of title 38, United States Code, before, on, or after the date of enactment of this Act [Aug. 5, 1997].”

Effective Date

of 1981 AmendmentAmendment by Pub. L. 97–66 effective Oct. 17, 1980, see section 701(b)(3) of Pub. L. 97–66, set out as a note under section 1114 of this title.

Effective Date

of 1976 AmendmentAmendment by Pub. L. 94–324 effective June 30, 1976, see section 9(a) of Pub. L. 94–324, set out as a note under section 3701 of this title.

Reference

Citations & Metadata

Citation

38 U.S.C. § 3726

Title 38Veterans' Benefits

Last Updated

Apr 6, 2026

Release point: 119-73