| Pay The Delinquency:
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| Under most circumstances, loan holders are required to accept payment of the full delinquency and reinstate the loan. The delinquency may include certain legal fees and costs if the mortgage company has started the foreclosure process. Many loan holders require certified funds for reinstatement.
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| Repayment Agreement:
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The most common way to bring your loan current is to repay part of the delinquency each month in addition to your regular payment. Should you need VA assistance proposing a repayment plan to your mortgage company a financial statement is required. A completed financial statement will allow your VA Servicing Representative to determine a repayment schedule best suited to your needs. Contact Loan Adminstration.
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| Forbearance:
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| If you are temporarily unable to meet your monthly mortgage obligation, your mortgage company may extend forbearance by agreeing to suspend payments or accept partial payments for a limited period of time until you will be able to begin a repayment schedule. VA cannot require the mortgage company to give forbearance or to agree to a specific repayment schedule; however, mortgage companies will usually cooperate as long as you can show that you will be able to bring your loan current or resume payments on a specific date in the near future.
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| Payment Assistance:
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| VA does not have a program which would enable us to give you direct payment assistance. However, some state and local governments, as well as private charitable organizations, have programs which will make all or part of your mortgage payment for a fixed period of time. VA can provide information on these programs.
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| Reamortization / Loan Modification:
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If your loan is reamortized, the delinquency is added to the loan balance in order to bring your payments up to date. This increases your loan amount and will also increase your monthly payments. The amount of the payment increase will not be as great if the life of your loan is extended at the same time. Your loan holder is allowed to extend and/or reamortize your loan by VA regulations; however, we cannot require the holder to do so.
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| Refunding:
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| VA has discretionary authority to buy a loan from the mortgage company. This is called "refunding." We consider this alternative for every loan before foreclosure is completed. Your mortgage company must have already decided not to modify your loan, extend additional forbearance, or approve another repayment plan. If you are a homeowner who occupies the property and has the ability to make the mortgage payments, or will have the ability in the near future, you may qualify for refunding.
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| Private Sale:
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If you are not able to bring your loan current, a private sale of the property will enable you to meet your obligation and keep any equity you may have in the property. Most private sales are for more than the amount owing on the loan. You may sell the property to a buyer who gets his or her own financing and pays off your VA loan or a qualified buyer who will assume your responsibility for the loan. If the buyer is assuming your loan, you should contact VA and obtain a release of liability before the sale is closed.
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| Compromise / Short Sale:
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| If your property cannot be sold for an amount which is greater than or equal to what you owe on the loan, VA may pay a "compromise claim" for the difference to help you complete the sale. You must contact VA to discuss the situation and get prior approval for a sale with a compromise claim payment. Some mortgage companies are authorized by VA to approve a sale with a compromise claim.
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| Deed in Lieu of Foreclosure:
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If a private sale does not appear realistic, the mortgage company will consider accepting a deed in lieu of foreclosure. If there are no liens on the property, and the mortgage company agrees to accept a deed, you will have to sign legal papers transferring ownership to the mortgage company. Normally, VA will have to pay your mortgage company a claim for the difference between the value of the property and the amount you owe on the loan. If a deed is accepted, you may be released from all further liability or you may be asked to agree to repay the Government all or part of the amount paid to the mortgage company. Please note that your mortgage company will usually report "voluntary foreclosure" on your credit report instead of "foreclosure." We cannot guarantee how future creditors will view this information. You may discuss this program with your mortgage company's "Loss Mitigation" division or a VA loan servicing representative.
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