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Lawmakers summoned the head of the Department of Veterans Affairs’ loan program, John Bell, to Capitol Hill this week and asked him to explain how the VA is going to fix a debacle that’s left many vets in danger of losing their homes.
His answer: They don’t know yet.
“We are looking for a solution to be able to help 40,000 borrowers stave off foreclosure,” Bell told them.
The VA has been scrambling since an NPR investigation revealed that it pulled the plug on a key program while thousands of vets were still in the middle of it – effectively turning a well-meaning pandemic aid effort into a bait-and-switch trap for homeowners.
At issue is what’s called a COVID mortgage forbearance. Set up by Congress after the pandemic hit to help people who lost income, it gave homeowners with federally backed loans a sanctioned way to skip mortgage payments. The missed payments would get moved to the back of the loan term so when homeowners got back on their feet they could just resume their normal payments.
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