VA halts foreclosures through 2024 to give struggling homeowners a chance to modify their mortgage with their new VASP program.
If you’re a Veteran or active-duty service member with a VA-guaranteed home loan and you’re facing foreclosure, the Veterans Affairs Servicing Purchase (VASP) program may help you keep your home.
VASP is a last-resort option for keeping your home when your loan servicer has determined that no other option can help you avoid foreclosure. The other options that the servicer will consider first for you are repayment plans, special forbearances, or loan modifications.
Through this program, VA purchases the modified loan from your current loan servicer. A modified loan means that the servicer changed the loan terms to make it easier for you to repay what you owe.
Will you qualify for the VASP Program?
Criteria:
What's the downside of the VASP Program?
The downside with loan modifications of any kind, is that in restructuring the loan, you end up with a higher balance on the loan in order to make the payment affordable. In many cases you will be left with no equity at all. This is especially true today as interest rates are rising, so you will likely be modifying your mortgage with a higher interest rate than you have now.
If you're already upside down in your loan, or will end up upside down after a modification, a short sale may be a better solution to get out of an unaffordable home with no equity.
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Last Updated on June 7, 2024 by Minna Reid