Housing advocates ‘very worried’ veterans could face foreclosure as VA mortgage rescue program phases out | CNN Politics

Concerns over Veteran Foreclosures

The Department of Veterans Affairs (VA) is ending its Veterans Affairs Servicing Purchase Program (VASP), a mortgage rescue program for veterans facing financial hardship. This decision has sparked worry among housing advocates and Democrats, who fear a rise in veteran foreclosures.

Program Details and Concerns

VASP, established in 2024, purchases troubled veterans' loans and modifies them to prevent foreclosures. The VA has purchased over 17,000 loans worth over $5.48 billion. Critics, including the Center for Responsible Lending, point to approximately 81,000 veterans already in default on their VA mortgages, expressing concerns about the lack of a replacement program. They argue that without VASP or an alternative, many veterans will face foreclosure.

VA and Political Responses

The VA defends the decision, stating it's not intended to be a mortgage restructuring service, and highlights existing home loan programs. Republicans, while praising the end of VASP due to taxpayer concerns, are proposing a partial claims program. Democrats strongly oppose the move, calling it 'cruel' and 'wrong,' and are introducing their own legislation to provide a replacement program.

Key Players and Actions

• Mortgage Bankers Association expressing concern.
• Center for Responsible Lending warning of potential mass foreclosures.
• Republicans proposing a partial claims program as an alternative.
• Democrats introducing legislation to replace VASP.
• Veterans of Foreign Wars urging members to act before the deadline.

The VA assures current VASP enrollees won't be affected, but the future for many veterans facing financial difficulties remains uncertain.