(Photo: HUD/David Valdez)
The VA has launched a new foreclosure-prevention program to help Veterans who have fallen behind on their VA-backed home loans stay in their homes.
The VA Partial Claim Program officially opened on June 15, after being authorized through the VA Home Loan Reform Act, which President Donald Trump signed into law on July 30, 2025. The program gives eligible Veterans a way to catch up on missed mortgage payments without immediately changing the terms of their original VA loan.
Veterans who are in default or at risk of default and may qualify for program assistance. Eligible borrowers must complete a three-month trial payment plan to show they can resume making their regular monthly mortgage payment.
If the Veteran successfully completes the trial period, the mortgage servicer pays the overdue amount needed to bring the loan current. The VA then reimburses the servicer for that amount.
The money does not become a new monthly payment for the Veteran. Instead, it is treated as a separate subordinate lien on the property. The amount is generally repaid when the home is sold, the VA loan is refinanced, or the mortgage is paid in full.
“We are grateful to Congress and President Trump for creating VA’s Partial Claim Program, which will help keep thousands of Veterans in their homes,” VA Secretary Doug Collins said.
Borrowers must have a home loan backed by VA to qualify for this option. Conventional, FHA, and USDA loans are not covered. The home must also be the Veteran’s primary residence. Rental properties and second homes do not qualify.
The partial claim may cover more than missed principal and interest payments. Past-due property taxes, homeowners’ insurance premiums, and homeowners’ association dues may also be included. The VA can generally advance up to 25% of the unpaid principal balance on the loan. In some COVID-era cases, that limit may increase to 30%.
Borrowers can generally use the partial claim once on the same loan. VA may consider another claim only when the hardship is connected to a presidentially declared disaster.
The VA says the Partial Claim Program is one of multiple options available for Veterans trying to avoid foreclosure. Other options include repayment plans, traditional loan modifications, 30-year and 40-year loan modifications, VA disaster modifications, and disaster extension modifications.
Veterans who are behind on payments or struggling to work with their mortgage servicer can contact VA at 877-827-3702, option 6. The VA also encourages borrowers to contact their loan servicer early, before missed payments turn into foreclosure proceedings.
Author: Rikki Almanza
Rikki is a Web Content Coordinator for the American Legion, Department of California. With a deep-rooted family connection to the military, Rikki is committed to using her skills and knowledge to provide valuable assistance and resources to servicemembers and veterans.
