Northville, Michigan – In July 2025, President Donald Trump signed the VA Home Loan Program Reform Act. The Act establishes a partial claim program for veterans experiencing difficulty paying mortgages backed by the Department of Veterans Affairs (VA).

The new program replaces the Veterans Affairs Servicing Program (VASP). VASP provided assistance to homeowners by offering lower mortgage rates, making monthly payments more affordable. This assistance helped many veterans avoid foreclosure and keep their homes by rehabilitating their mortgages and getting back on track with payments. 

Under the new law, the VA is authorized to take certain listed actions to help veterans who face defaults on home loans. The law also establishes a partial claims program. Under the VA Home Loan Program Reform Act:

• The VA can provide cash payments to veterans sufficient to avoid foreclosure, as long as the VA and the homeowner meet certain paperwork requirements.
• The VA must create loss mitigation procedures to help prevent foreclosures. These procedures must be followed before the VA can take certain actions, like changing the terms of a home loan. 
• The bill creates a five-year partial claims program. Under this program, the VA can buy a portion of the outstanding debt on a veteran’s home if the homeowner is in default or is at imminent risk of default.” 
• The bill requires the VA to report to Congress about its efforts. 

The new program seeks to provide more consistent support for veterans facing financial hardship. By aligning the VA’s approach with those used in other federal housing programs, the federal government hopes to provide consistent support more efficiently. 

The GI Bill established the VA home loan program in 1944. The program helps veterans obtain home loans at manageable prices, among other assistance. The program’s goal was to help veterans adjust to civilian life by providing them with the means to access homeownership. Currently, over 3.7 million active home loans are guaranteed by the VA. 

Navigating home loans can be complex. Veterans’ benefits, while intended to help veterans with homeownership, can make the process more confusing. An experienced veterans affairs lawyer can help.