President Donald Trump has officially signed the VA Home Loan Program Reform Act into law, in an effort to help prevent veterans from losing their homes to foreclosure. This new partial claims program, established under the Department of Veterans’ Affairs’ (VA) Home Loan Program, allows veterans who are behind on mortgage payments to add those payments to the end of their loans.
The partial claims program is intended to replace the Veterans Affairs Servicing Purchase (VASP) program, which was created in 2024 under the Biden administration but was eliminated by the Trump administration in May. The VASP program had the VA purchasing delinquent VA loans from mortgage servicers, adjusting the loans, and offering borrowers a fixed 2.5% interest rate for the duration of the loan.
Critics of the VASP program, particularly Republicans, argued that it was established without input from Congress and posed a risk to the VA home loan guarantee program while also being costly for taxpayers. The VA reported purchasing over 17,000 home loans totaling more than $5.48 billion dollars under the VASP program.
Both the House and the Senate passed versions of the VA Home Loan Program Reform Act, with bipartisan and bicameral support. This legislation aims to assist veterans facing financial challenges and provide the VA with tools to help veterans remain in their homes and avoid foreclosure.
The VA Home Loan Program has been a crucial benefit for veterans and their families since its inception in 1944, helping them build home equity.
This is a developing news story and will be updated as more information becomes available.
