VA Home Loan Program Reform Act

The VA Home Loan Program Reform Act aims to provide the Department of Veterans Affairs with more tools to prevent veterans from losing their homes during financial hardship. The bill would authorize the VA to pay loan holders directly to stop foreclosures, provided the veteran and the lender agree to terms that give the VA a secured interest in the property. It also proposes a sequence of mandatory loss mitigation steps that lenders must follow before taking certain administrative actions against a borrower.

Additionally, the legislation would establish a five-year Partial Claim Program. Under this initiative, the VA could purchase a portion of a veteran's unpaid debt for a primary residence if they are in default or at risk of falling behind. While this helps keep the veteran in their home, the bill specifies that the individual would remain liable to the government for any losses resulting from a subsequent default on these assisted loans.

Finally, the bill would require the VA to report to Congress on how to ensure veterans are not disadvantaged when hiring real estate agents or brokers. This study is intended to identify and remove barriers that might make VA loan users less competitive than other buyers in the housing market.