If you have a VA home loan and you’ve been worried about falling behind, here’s something you need to know:
The VA had a program that helped over 17,000 veterans avoid foreclosure — by stepping in when mortgage servicers couldn’t.
But it’s ending soon. And if you’re not in it by May 1, you might not have access to the same kind of help if things get tough.
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What the VASP program did — and why it mattered
The program is called VASP — short for Veterans Affairs Servicing Purchase. The Department of Veterans Affairs (VA) launched it last year to help veterans who hit a financial wall and were in danger of losing their homes.
Here’s how it worked: If a veteran with a VA-backed mortgage couldn’t keep up with payments and the loan servicer didn’t have a solution, the VA could buy the loan and modify it. In many cases, they dropped the interest rate to a fixed 2.5% — a huge deal at a time when market rates are much higher. For some, like Texas homeowner and veteran Robert Johnson, that meant saving over $1,500 a month.
It wasn’t flashy. It wasn’t widely publicized. But it worked. Over 17,000 veterans stayed in their homes because of it.
So why is it ending?
The VA says the program was temporary and created without formal approval from Congress. A spokesperson said the VA “is not intended to be a mortgage-loan restructuring service,” and pointed out that the agency doesn’t have the infrastructure to keep managing this kind of direct loan support long term.
That explanation hasn’t sat well with housing experts or veteran advocates — especially because there’s no replacement plan yet in place.
And this is happening at a time when a lot of veteran homeowners are already struggling.
Foreclosures on VA loans are rising
At the end of 2024, a long-running foreclosure moratorium for veterans expired. That pause had kept a lot of struggling homeowners from losing their homes during hard times. But once it ended, foreclosure activity started climbing.
In January 2025, one in five homes entering foreclosure had a VA loan. That’s unusually high. And by February, foreclosure starts were up 34% from the same time last year, according to data from Intercontinental Exchange.
With VASP ending, there’s concern that even more veterans will slip through the cracks.
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What other options are out there
Before VASP, the VA had a partial-claim payment program that let homeowners delay their missed payments and pay them back later — without extra interest. That program expired in 2022. Since then, the VA has had fewer tools to help veterans compared to other government agencies like FHA or Fannie Mae.
There’s some movement in Congress to bring partial-claim payments back, and VA leadership says there are still other options like repayment plans and loan modifications. But none of them reduce monthly payments the way VASP did.
Housing advocates and servicers say they’re worried. One expert at a mortgage servicing company in Houston estimated that a quarter of the loans they handle are VA-backed — and warned that without VASP, delinquencies are likely to rise.
What should you do if you’re struggling?
If you’re behind on your mortgage or worried about keeping up, here’s what you can do right now:
- Contact your loan servicer. Ask what options are available and let them know you’re facing hardship.
- Call the VA directly at 877-827-3702 to speak with a loan technician who can walk you through next steps.
- Reach out to a HUD-approved housing counselor (many offer free help): hud.gov/housingcounseling
- Talk to a trusted real estate agent if you’re considering selling before things get worse.
And most importantly: don’t wait. The deadline to apply for VASP is May 1, 2025 — and if you qualify, it could make a major difference.
You’re not alone in this
The hardest part for a lot of veterans facing financial trouble isn’t the money — it’s the silence. Many don’t want to ask for help. But that’s exactly what programs like VASP were built for.
Even though this one’s going away, there are still people ready to support you. Whether it’s a counselor, a loan tech at the VA, or someone you trust in the housing space — reach out.
You fought for the country and should be able to keep your home. And there’s still time to take action.
Written by: Aleksandra Kadzielawski