TRUMP HAS ENDED VASP, A KEY PROGRAM HELPING VETERANS AVOID FORECLOSURE
The mortgage-rescue program that has helped about 20,000 Veterans avoid foreclosure and keep their homes was ended by the U.S. Department of Veterans Affairs on Thursday. It served as one of the most helpful programs that was offered to Veterans.
What Was the VASP Program?
If you were a Veteran or active-duty service member struggling with mortgage payments on a VA-backed loan, the VASP program was supposed to help you keep your home by allowing the VA to buy your modified loan from your lender.
By doing so, the terms of your loan would be adjusted so that you receive more manageable payments.
Veterans who participated in the program often had no affordable way to catch up on their VA-backed home loans; therefore, the VA Servicing Purchase program was originally placed by the Biden administration after the issue.
It provided a lifeline where loan servicers have been submitting VASP applications until last year on May 31, 2024, so that it could provide even more financial security to Veterans who may be going through a hard time.
Now that there is a higher mortgage rate of 7%, Veterans only have this affordable option with VA loans. About 90,000 VA loans are now at risk, and 33,000 are already in the foreclosure process.
Why Did the VA End the Program?
The ending of the VASP program presents potentially significant issues for the Veteran community. Kevin Conlon, who is a former Army service member, is one member of the community who is facing hardship due to the ending of the program. He relied on the VASP to avoid losing a home when times were tough.
When there were delays and confusion about the program, Conlon and others were told to stop making payments while waiting to enroll. Now, with the VASP program being officially closed, he is falling into a deeper debt.
“I was willing to die for what I believed in,” Conlon told NPR. “And for someone to take away the home that my family lives in? We’ve paid enough. We really have.”
Now, Conlon owes more money than before and might lose the home where his family currently live. However, Conlon is not the only one in this situation.
VASP Was Meant to Be a Lifeline
The VA home loan has been a helpful lifeline for many Veterans, as it offered no down payment, no private mortgage insurance, and better loan terms. This has helped thousands of Veterans secure a home.
"With the expiration of VASP, tens of thousands of Veterans and their families are now at significant risk of losing their homes," said Mike Calhoun, president of the nonprofit Center for Responsible Lending, a nonpartisan organization that advocates for the financial rights of underserved communities, including Veterans.
The program was created to make sure that they could build a life after service, but now, many Veterans are at risk of losing their homes. Despite the good that the VASP program provided, ultimately, a decision was made to end the program.
What Can We Do to Help?
After putting their lives on the line for the USA, they were promised that they would have support in tough times, especially with housing. But now, through no fault of their own, Veterans are facing foreclosure.
"Without the VA loan, there was no way that we could have afforded to buy a house," Conlon’s wife said.
Although some lawmakers are trying to introduce new options to help Veterans catch up on missed payments, nothing has been passed yet, and time is running out.
Therefore, if nothing changes, more than 10,000 Veterans could lose their homes, and without these key programs, such as the VA Servicing Purchase program, help and choices are limited.
Updated by Allison Kirschbaum
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