Vets deserve to stay in their homes — VA is about to put that at risk
The uniformed men and women of the U.S. armed forces put their lives at risk to protect our security and freedoms. In return, service members expect little. They don't do it for the pay. They do it to preserve the American Dream and give back to this great nation. Through their sacrifices, they have earned the privilege to pursue a pillar of the American Dream: homeownership.
Unfortunately, the Department of Veterans Affairs is about to put thousands of veterans at risk of losing their homes, depriving them of the American Dream that they fought to protect.
The VA has long sought to step in as a backstop when financially strained vets fall behind on their mortgage payments. It is a sad reality, but there is a demand for such services.
To support veterans and their families during the pandemic, the VA rolled out a partial claims program that offered relief to struggling vets, allowing them to move missed mortgage payments to the backend of their loan. Last year, the VA replaced that program with a new one called the Veterans Affairs Servicing Purchase (VASP) program, which more than 17,000 veterans currently depend on.
Earlier this month, the VA confirmed it would end the VASP program with no off-ramp to service the 17,000 veterans who will now be put at risk of foreclosure. The VA said it will shut the program to new enrollees as soon as May 1. Apparently, recognition for selflessness and sacrifice of service to the nation does not apply to veterans.
VASP is a 'last resort' option to help families experiencing economic hardship. As part of VASP, loan servicers working with the VA modify loans to a 2.5% rate, and then sell the loan to the VA. This has allowed veterans and their families to remain in their homes with an affordable monthly mortgage payment.
With VASP winding down, the back-owed amount on veterans' mortgages could be wrapped into a 30- or 40-year mortgage at current rates. Not surprisingly, this is spiking due to tariff uncertainty. That means vets would miss out on the VA program's discount and instead be saddled with historically high rates.
Some have argued the VASP program introduced financial risk at the VA by keeping distressed mortgages on the department's books. VASP is not perfect. But ending the program without a replacement for the military families who need it is reckless. This places the risk exclusively in the hands of the veteran, not the department responsible for identifying and mitigating risk.
There has been only scant discussion on how to responsibly replace this safety net for veterans and service members. The accelerating speed and recklessness of this policy change will inevitably harm veterans.
The VA and its partners in Congress owe it to veterans to come up with a solution that keeps veterans in their homes. Lawmakers and officials could do this by allowing mortgage servicing companies to bundle missed payments into a noninterest lien that gets put on the house and becomes due once the mortgage is paid or the home is sold. That way, the VA isn't taking added risk on its books and veterans get to keep their homes.
Service members and veterans vote, and 65% of veterans who voted in the 2024 presidential election said they cast their ballot for Trump, according to Election Day exit polls. They are a core part of his coalition. You'd think our president and VA Secretary Doug Collins, who clearly are not apolitical, would embrace their duty to take care of our veterans. The nation's veterans deserve gratitude and support from the government. They expect as much, especially from this administration.
When the VA abruptly discontinued the pandemic-era Partial Claim Program in 2022, thousands of veterans were forced to refinance their mortgages at a time when interest rates had doubled. The financial stress on these veterans was not only unnecessary and predictable but also disappointing in terms of the promise the country has made to repay their sacrifices.
One can hope that the abrupt flip on VASP is simply a case of Department of Government-inspired cost-cutting gone too far. After all, Elon Musk prefaced the work of DOGE by asserting that although they will inevitably make mistakes, they'll 'fix them very quickly.' Cutting VASP without an alternative in place — even for the few months that it could take new legislation to be implemented — is a mistake.
The VA and members of Congress have little time to offer a solution that will allow veterans to stay in their homes. It is, however, their sacred duty to find one.
James 'Spider' Marks, a retired U.S. Army major general, was the senior intelligence officer for the 2003 liberation of Iraq and the former commanding general of the U.S. Army Intelligence Center. He currently serves as the director of geo-political intelligence for Academy Securities, a New York-based veteran-owned bank.
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