H.R. 1815 · Signed into law · Armed Forces and National Security

VA Home Loan Program Reform Act

Sponsor: Derrick Van Orden (R-WI)

What it does

• Authorizes the VA to pay loan holders an amount necessary to avoid foreclosure of VA-guaranteed home loans, provided the borrower and lender execute documents giving the VA a secured interest in the property.
• Requires the VA to establish loss mitigation procedures to prevent foreclosure on VA home loans before the agency takes specified administrative actions.
• Establishes a Partial Claim Program allowing the VA to purchase a portion of indebtedness on VA loans for primary residences in default or at imminent risk of default.
• Requires veterans who default on loans with VA partial claims to remain liable to the VA for any resulting losses from the default.

Official summary

VA Home Loan Program Reform Act This bill authorizes the Department of Veterans Affairs (VA) to take certain actions in cases of default on home loans under the VA home loan program and establishes a partial claim program. First, the bill authorizes the VA to pay the holder of a loan guaranteed by the VA an amount necessary to avoid the foreclosure of the loan, provided that the holder of the loan and the veteran obligated on the loan execute documents to ensure the VA obtains a secured interest in the property covered by the loan. The VA must prescribe loss mitigation procedures to help prevent the foreclosure of such a home loan. The VA may not take specified administrative actions (e.g., consent to the modification of loan terms) until the sequence of mitigation options has been completed. Next, the bill establishes a Partial Claim Program under which the VA may make a partial claim (purchase a portion of the indebtedness) on VA loans for primary residences that are in default or at imminent risk of default. Individuals who default on loans for which the VA has made a partial claim under this program must be liable to the VA for any loss resulting from the default. Finally…

Latest action

Jul 30, 2025: Became Public Law No: 119-31.

Committee: Senate Veterans' Affairs