VA Partial Claim Program: A New Foreclosure-Prevention Option for Veterans
The VA Partial Claim Program is now open for submissions, and it could become an important foreclosure-prevention tool for Veterans with VA-guaranteed home loans.
For Veterans who have fallen behind on mortgage payments, the program may allow VA to advance money to the mortgage servicer to bring the loan current. The past-due amount is then moved into a separate subordinate lien that does not have to be repaid right away.
That matters because a Veteran who is behind on payments may not be able to catch up all at once. A partial claim can create a path to stop the delinquency from growing, resume regular mortgage payments, and avoid foreclosure.
But the program has rules, timing issues, and practical limitations. Veterans should understand how it works before relying on it.
What Is the VA Partial Claim Program?
The Partial Claim Program is a VA foreclosure-prevention option for certain VA-guaranteed home loans.
In simple terms, VA may pay the mortgage servicer the amount needed to bring the loan current. That payment does not disappear. Instead, it becomes a separate obligation secured by the home. The partial claim is subordinate to the first mortgage, meaning it sits behind the original VA-guaranteed loan.
The Veteran generally repays the partial claim later, such as when the home is sold, refinanced, or the first mortgage is paid off.
This can give a struggling borrower breathing room. Instead of trying to pay all missed mortgage payments immediately, the borrower may be able to restart regular monthly payments after the arrears are handled through the partial claim.
Why This Program Matters
Falling behind on a mortgage can move quickly from financial stress to foreclosure risk.
VA explains that if a borrower falls behind on mortgage payments, the mortgage servicer can foreclose by taking ownership of the home and selling it to recover the money owed. For Veterans, foreclosure can also affect future use of the VA home loan benefit.
The Partial Claim Program gives VA another tool to help Veterans keep their homes.
It is especially important because Veterans with VA loans have sometimes had fewer home-retention options than borrowers with other federally backed mortgages. Consumer advocates have pushed for a permanent partial-claim option because similar tools exist in other mortgage programs.
Who May Benefit?
The program is aimed at Veterans with VA-guaranteed home loans who are in default or at imminent risk of default.
The law authorizes VA to make a partial claim for a loan that is:
- guaranteed by VA,
- tied to the borrower’s primary residence, and
- determined by VA to be in default or at imminent risk of default.
That means the program is not for every homeowner and not for every type of loan. It is specifically connected to VA-guaranteed home loans and home-retention situations.
Veterans should not assume they qualify automatically. They must work with their mortgage servicer to determine whether the Partial Claim Program is available and appropriate for their situation.
How Much Can VA Advance?
Under the VA Home Loan Program Reform Act, the standard partial claim amount generally may not exceed 25% of the unpaid principal balance of the loan on the date the partial claim is made.
There is also a temporary higher limit for certain borrowers. If the borrower failed to make a payment during the period beginning March 1, 2020, and ending May 1, 2025, the partial claim may be allowed up to 30% of the unpaid principal balance.
That detail is important because some Veteran borrowers are still dealing with the long-term effects of pandemic-era forbearance, hardship, job loss, illness, or payment disruption.
The 3-Month Trial Payment Plan
VA’s foreclosure-help page states that before a borrower can get a partial claim, the borrower must successfully complete a 3-month trial payment plan.
That means the borrower must be able to make the mortgage payment on time for 3 straight months.
This requirement is important. It shows the servicer and VA that the borrower can resume making regular payments after the arrears are addressed.
For Veterans, the practical takeaway is simple: if your servicer offers a trial payment plan, take it seriously. Keep proof of every payment. Confirm the due dates. Keep records of all communications. Do not rely only on phone conversations.
The Servicer Timeline Problem
The program is open, but there is a practical implementation issue.
VA says servicers have until November 28, 2026, to implement partial claims into their systems. That means some borrowers may hear that the program exists, but their mortgage servicer may not yet be ready to process it.
The National Consumer Law Center has warned that this gap could leave some Veterans exposed to foreclosure or unaffordable payment options before the new program is fully available through all servicers.
That is why Veterans should not wait passively.
If you are behind on a VA-guaranteed mortgage, contact your servicer and ask specifically whether the VA Partial Claim Program is available for your loan. If the servicer says it is not yet implemented, ask what foreclosure-prevention options are available now and whether foreclosure activity will be paused while the servicer prepares to offer the program.
What Veterans Should Ask Their Servicer
When speaking with the mortgage servicer, Veterans should ask direct questions and keep notes.
Useful questions include:
- Is my loan VA-guaranteed?
- Am I being reviewed for the VA Partial Claim Program?
- Is your company currently able to process VA partial claims?
- If not, when will your system be ready?
- Am I eligible for a 3-month trial payment plan?
- What is the exact payment amount and due date for each trial payment?
- Will foreclosure activity be paused during review or the trial plan?
- What documents do you need from me?
- Are you offering any alternatives, such as repayment plan, forbearance, or loan modification?
- Will the proposed option increase my monthly payment?
- Will any missed payments, taxes, insurance, or fees be included?
- Can you send the offer in writing?
Veterans should write down the date, time, phone number, representative’s name, and what was said during each call.
VA Loan Technicians Can Help
VA says borrowers should contact their loan servicer right away if they are having trouble making mortgage payments.
VA also says borrowers with VA-guaranteed loans can contact VA at any time to discuss the loan. If a VA-guaranteed loan is 61 days past due, VA will automatically assign a VA loan technician to review the loan.
Veterans can contact a VA loan technician at 877-827-3702.
This is important because a Veteran does not have to rely only on the mortgage servicer’s explanation. If there is confusion, delay, or concern about foreclosure, VA loan technicians may be able to help explain options or review the situation.
Other Foreclosure-Avoidance Options
The Partial Claim Program is not the only possible option.
VA lists several foreclosure-avoidance tools, including:
- repayment plan,
- special forbearance,
- loan modification,
- partial claim,
- extra time to arrange a private sale,
- short sale, and
- deed in lieu of foreclosure.
Each option has different consequences.
A repayment plan may help if the borrower only missed a few payments. A forbearance may provide time, but missed payments still have to be addressed. A loan modification can create a new payment schedule, but VA warns that modified payments may increase due to rising interest rates. A short sale or deed in lieu may avoid foreclosure, but could affect future VA home loan entitlement.
The right option depends on the borrower’s income, hardship, loan status, amount past due, property value, and whether the borrower can resume regular payments.
Watch Out for Scams
Veterans behind on mortgage payments are often targeted by scammers.
VA warns borrowers to contact VA or their mortgage servicer to avoid scams or third-party companies trying to take advantage of them. This is especially important when a new program is announced, because scammers may use the name of a real program to pressure homeowners into paying fees or signing documents.
Red flags include:
- promises to stop foreclosure immediately,
- demands for upfront fees,
- instructions to stop talking to the servicer,
- pressure to sign over a deed,
- claims that only the company can access VA assistance,
- requests for sensitive information through suspicious links, and
- refusal to put terms in writing.
Veterans should work with trusted sources, their servicer, VA, HUD-approved housing counselors, or qualified legal help.
What If a Foreclosure Notice Has Already Been Sent?
A foreclosure notice should be taken seriously.
A Veteran who receives a foreclosure notice should act quickly. The deadline may depend on state law, the mortgage documents, and where the case is in the foreclosure process.
Practical steps include:
- Contact the mortgage servicer immediately.
- Ask whether the loan is being reviewed for the VA Partial Claim Program.
- Ask whether foreclosure can be paused during review.
- Contact VA at 877-827-3702.
- Save every letter, email, notice, and payment record.
- Request the complete loss-mitigation history.
- Consider speaking with a foreclosure-defense or consumer-protection attorney.
- Do not ignore court papers or sale notices.
The earlier a borrower acts, the more options may be available.
Documents Veterans Should Keep
Veterans seeking help should keep copies of:
- mortgage statements,
- past-due notices,
- foreclosure notices,
- trial payment plan offers,
- proof of payments,
- hardship letters,
- servicer letters,
- escrow statements,
- tax and insurance bills,
- VA correspondence,
- emails and portal messages,
- call logs,
- loss-mitigation applications,
- denial letters, and
- any documents related to a modification, forbearance, or partial claim.
Good records matter because servicers can make mistakes. A complete paper trail can help show what was offered, what was paid, and whether the servicer followed the required process.
Bottom Line
The VA Partial Claim Program is an important new foreclosure-prevention option for Veterans with VA-guaranteed home loans.
It may allow VA to advance funds to bring a delinquent loan current, with the overdue amount moved into a subordinate lien that is repaid later. For some Veterans, that could be the difference between losing a home and getting back on track.
But the program is not automatic. Borrowers must work with their mortgage servicer, complete a 3-month trial payment plan, and confirm whether the servicer is ready to process partial claims. Because servicers have until November 28, 2026, to implement the system, Veterans should be proactive and document every step.
If you are behind on a VA-guaranteed mortgage, do not wait. Contact your servicer, call VA at 877-827-3702, ask about the Partial Claim Program, and keep careful records.
This article is for general information only and is not legal advice. Reading this article or contacting our office does not create an attorney-client relationship unless we agree to representation in writing.