Introduction
The VA Loan Guaranty Service is the organization within the Veterans Benefits Administration (VBA) charged with the responsibility of administering the home loan program. VA’s Home Loan Program is for veterans and active duty military personnel and certain members of the Reserves and National Guard; and allows various real estate professionals, banks and mortgage companies, to offer VA-guaranteed loans. With VA guaranteeing a portion of the loan, veterans can receive a competitive interest rate without making a down payment if the lender agrees, making it easier to buy a home and allowing the lender to sell more homes. Therefore the program advantages both the veteran and the lender.
The following topics are also addressed below:
- The home adaptation programs which is of value to those who are severely injured due to direct combat and the seriously disabled.
- How the VA can assist you when you are facing foreclosure .
- The VA policy on natural disasters affecting a home or home loan.
- And finally, a developing list of nonprofits that can assist in building and adapting homes.
The Master Portal Site
For the comprehensive, mother site of VA Home Loan Guaranty Service, click here.
The Home Loan Guaranty Program
For an overview of the program click here.
Home Adaptation Programs
To learn about adapting a home for special needs and the grants available (three grant programs currently), click here. There are currently three types of VA grants: Temporary Residence Adaptation (TRA), Specially Adapted Housing (SHA, aka “Homes for Heroes), and Special Housing Adaptations (SHA).
Avoiding Foreclosure
Since at least 2008, veterans defaulting on their mortgages has been a concern. Unlike several other states, Pennsylvania has no special home loan programs to assist. However, for veterans there possible recourse through a service offered by the Department of Veterans Affairs, the Cleveland Regional Loan Center (Cleveland Regional Office) and perhaps others for those of us who live in the Lehigh Valley.
If you used a VA Home Loan Guaranty, the VA has the legal authority to intervene on the borrower’s behalf: If you expect to fall behind on your payments or are behind, the information below from the Cleveland Office offers options to make your loan current and save your home from foreclosure:
- When your loan goes into default, your servicer/holder is responsible for contacting you, the mortgagor, to determine the reason for the default and attempt to make arrangements to cure the delinquency.
- If the problem can not be resolved by the time you are three payments past due, the servicer/holder is required to notify VA that your loan is in default. After this notice is received, VA will attempt to contact you to discuss your current situation and help you determine the best course of action. It can also help you communicate with your servicer. For detailed information on how to reach one of our Loan Service Representatives, please go to Cleveland Loan Center’s Contacts Page.* You should be prepared to discuss:
- The reason you are, or will soon be, in default
- Your current financial/employment situation
- Whether you or someone else occupies the property
- Whether or not you wish to keep the property
- Most foreclosures result in losses to everyone involved, the veteran, the servicer/holder, and VA. Many foreclosures can be avoided, particularly when all parties work together. The following are methods of avoiding foreclosure (hyperlinks):
- Private Sale , to include Short Sale
If you did not use a VA Home Loan Guaranty, the VA may still help.
- Assistance and a New Recourse: For a veteran or service member who may have obtained a conventional or sub-prime loan, the VA Regional Loan Centers can offer advice and guidance. As above, ours is the Cleveland Regional Loan Center. However, unlike a VA guaranteed home loan, the legal authority to intervene does not exist. Nevertheless, their assistance might help resolve your issues and new options for refinancing to a VA-guaranteed home loan now exist – having from the Veterans Benefits Improvement Act of 2008, a little remarked upon but important act.
- VA Refinancing of a non-VA Guaranteed Home Loan:Veterans who wish to refinance their subprime or conventional mortgage may now refinance up to 100% of the value of the property (the previouls limit was 90%). Addtionally, the Congress raised the maximum loan guaranty for refinancing loans – from $144,000 to $417,000 at least, for high cost counties have even higher maximum loan limits. These limits can be found at http://www.benefits.va.gov/homeloans/.These changes will allow more veterans to refinance through the VA to prevent default or a big payment increase.
There may be other sources of assistance if the VA cannot help.
- HOPE NOW: If the VA is unable to help a veteran with a conventional loan or loan with VA guaranty to retain the home, according to the VA, the HOPE NOW Alliance might assist. It is a joint alliance consisting of servicers, financial counselors and investors whose ultimate purpose is to prevent avoid foreclosures as a result of the crisis that has occurred in the mortgage market. It know of programs that take advantage of relieve measures the VA cannot. Call 1-888-995-4673 (HOPE) or go online to www.hopenow.com .
- SCRA – for Servicemembers and those recently discharged: Veterans may be able to request relief through the Servicemembers Civil Relief Act (SCRA). The Act was intended to ease the economic and legal burdens on military personnel during their active duty military service. To qualify, the loan must have originated before the current period of active service. SCRA might result in a lower interest rate. It may also prevent foreclosure or eviction up to nine months from discharge. For more information in readable form, consult http://usmilitary.about.com/od/sscra/
If You Are Facing Homelessness (Being on the Streets): Veterans who feel they may be facing homelessness as a result of losing their home, can call 1-877-424-3838 (4AID VET) or go online to http://www.va.gov/homeless/NationalCallCenter.asp to receive immediate assistance from the National Call Center for Homeless Veterans, a 24/7 hotline. With the new emphasis on preventing family homelessness, this might be a valuable resource to you, in extremis.
Footnotes:
* Or call 1-877-827-3702, the general number to reach the nearest Loan Guaranty Office if not in Pennsylvania or to find out additional information.
Sources:
For Additional Information:
Natural Disaster Policy
For the VA policy concerning home loan guaranty when natural disasters occur, click here.
Nonprofit Homebuilding/Renovation
Homes for Our Troops is a non-profit, non-partisan, 501 (c)(3) organization founded in 2004. This organization is strongly committed to helping those who have selflessly given to their country and have returned home with serious disabilities and injuries. It assists severely injured Servicemen and Women and their immediate families by raising donations of money, building materials and professional labor and then coordinating the process of building a new home or adapting an existing home for handicapped accessibility. The finished home is then given to the veteran. All is done at no cost to the veteran. Uses VA Specially Adapted Housing Grants (“Homes for Heroes”) to help defray costs.
RenovatingHope is a 501(c)(3) charitable organization headquartered in Pennsylvania whose mission is to provide professional, sustainable, home needs and services in an effort to be a source of renewal and hope to the families of men and women presently serving in the armed forces, as well as to veterans, whose deteriorating residences require repairs and/or upgraded appliances necessary to meet basic human needs, ensuring family safety and adequate comfort. RenovatingHope endeavors to serve those who have been overwhelmed by financial difficulties from which they have demonstrated attempts to recover. It uses a network of certified contractors and vendors to accomplish its mission at no cost to the applicant.
Last Updated: 16 May 2011
