May 29 (UPI) -- Officials for the Department of Veterans Affairs "strongly encouraged" mortgage lenders Wednesday to extend a veterans' foreclosure moratorium slated to end Friday.
"When a veteran falls on hard times, we work with them and their loan servicers every step of the way to help prevent foreclosure," VA Under Secretary for Benefits Josh Jacobs said in an online announcement.
"We're calling on mortgage services to extend a targeted foreclosure moratorium so we can make sure that veterans get the support they need to stay in their homes."
A new VA Servicing Purchase program takes effect Friday and is designed to help more than 40,000 veterans enduring "severe financial hardship" to stay in their homes.
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VASP helps eligible veterans, active-duty service members and surviving military spouses who have guaranteed VA home loans keep their homes.
The program enables the VA to buy defaulted VA loans from mortgage servicers, modify the lending agreements and place them among a portfolio of VA-owned direct loans.
VASP enables the VA to work directly with eligible veterans to adjust their loans and monthly payments while charging a flat lending rate of 2.5%.
VA officials said the VASP program creates a consistent and affordable payment for the remainder of respective mortgage loans to qualifying veterans.
While the VASP program launches Friday, mortgage servicers have until Oct. 1 to fully implement it.
The VASP program is the latest tool veterans can use to help them keep their homes.
Others include forbearance agreements, repayment plans and loan modifications designed to help veterans and other qualifying service members and surviving spouses to modify their home loans.
The VA said veterans struggling to make mortgage payments should contact their mortgage servicer to explore available home retention options.
Veterans also can call the VA at 877-827-3702 and enter option 4 or visit the VA Home Loans website to learn more about options for retaining their homes.
