The Department of Veterans Affairs will launch a new program in May designed to help veterans who are in financial dire straits to keep their homes.
The Veterans Affairs Servicing Purchase program, or VASP, will serve as a “last resort” option for former service members who have defaulted on their home loans and aren't eligible for other VA loan assistance programs.
Under VASP, the VA will purchase delinquent loans from holders and become the primary loan servicer, providing borrowers a stable payment plan at a fixed rate of 2.5% for the remainder of their loan, according to VA Under Secretary for Benefits Joshua Jacobs.
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The purpose, Jacobs said during a call with reporters on Tuesday, is for the program to serve as a safety net for an estimated 40,000 veterans at the highest risk for foreclosure and who “cannot resolve their delinquency through traditional VA home retention options.”
“Let me be clear, VASP is a last resort option that may be available when it is the most appropriate home retention option under VA's home retention waterfall,” Jacobs said.
Since the VA began backing home loans in 1944, it has helped active-duty troops, veterans and survivors purchase more than 28 million homes. Currently, more than 3.7 million veterans have a VA-guaranteed home loan, with the VA backing nearly 401,000 home loans in 2023 alone.
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