The VA Partial Claim Program 2026 has opened a new route for veterans who are behind on their VA-backed mortgage and trying to avoid foreclosure without giving up the loan terms they already have.
The program became available for submissions on June 15, 2026. It gives eligible borrowers a way to move missed mortgage payments into a separate deferred balance instead of forcing those amounts into the original home loan through a modification or refinance.
That distinction is important in today’s housing market. Many veterans still have mortgages with lower interest rates than what new borrowers may face now. For those homeowners, keeping the original loan intact could be the difference between a manageable payment and a more expensive long-term mortgage.
The new option arrives after the VA’s earlier Veterans Affairs Servicing Purchase program, known as VASP, ended on May 1, 2025. The gap that followed left many distressed borrowers with fewer ways to stop foreclosure, especially if they had recovered financially but could not immediately pay months of missed bills.
What Makes the VA Partial Claim Program Different?
The VA Partial Claim Program is built around one central idea: help the borrower become current without rewriting the entire mortgage.
If approved, the VA advances money to cover the delinquent amount on an eligible VA-guaranteed loan. The overdue balance is not added into the main mortgage payment. Instead, it becomes a subordinate lien on the property.
That separate lien generally has no monthly payment and no interest. It is usually repaid when the homeowner sells the home, refinances the VA loan, or pays off the original mortgage.
For a veteran who missed payments because of a temporary hardship but can now afford the regular monthly bill, this can be a more targeted solution than a full loan modification.
Who Is the Program Designed For?
The program is intended for veterans, service members and eligible borrowers with VA-guaranteed mortgages who are in default or close to default.
The property must be the borrower’s primary residence. That means second homes, rental homes and investment properties generally do not qualify.
The borrower must also show that the mortgage payment is affordable going forward. This is a key point. The VA Partial Claim Program can help clear past-due amounts, but it does not lower the regular monthly mortgage payment.
In practical terms, the program is best suited for borrowers who had a short-term disruption, such as a job loss, medical expense, delayed income, family emergency or temporary financial shock, and have since regained enough stability to resume normal payments.
The Three-Month Trial Payment Requirement
Before the partial claim is completed, borrowers are generally placed on a three-month trial payment plan.
During that period, the homeowner must make three consecutive on-time payments at the normal mortgage amount. The trial period helps the servicer and VA confirm that the borrower can stay current after the delinquency is removed.
This step is important because the program is not meant to postpone foreclosure for borrowers who still cannot afford the original loan. It is meant to repair a delinquency after a temporary hardship has stabilized.
How Much Can the VA Advance?
The VA can generally advance up to 25% of the unpaid principal balance on the mortgage at the time of the partial claim.
Some borrowers connected to COVID-era missed payments or hardship periods between March 1, 2020, and May 1, 2025, may qualify for a higher 30% cap.
For example, if the remaining loan balance is $300,000, the standard 25% limit could allow up to $75,000 in assistance. Under the expanded 30% limit, that amount could rise to $90,000.
The amount may cover more than missed principal and interest. Depending on the case, it may also include past-due property taxes, homeowners insurance premiums and HOA dues.
Why It May Beat a Loan Modification for Some Veterans
A loan modification changes the mortgage itself. It can extend the repayment term, add missed payments to the principal balance, or move the borrower into new loan terms.
A partial claim works differently. It separates the missed payments from the first mortgage and leaves the existing loan in place.
That can be valuable for veterans who already have a low mortgage rate. If a modification would reset the loan into less favorable terms, the partial claim may help the borrower recover without taking on a higher monthly cost.
However, a loan modification may still be more appropriate if the current mortgage payment is no longer affordable. A partial claim fixes the past-due balance, not the ongoing affordability problem.
How Veterans Can Request Help
Veterans do not apply through a public VA portal for this program. The process begins with the mortgage servicer.
Borrowers should call the servicer’s loss mitigation department and ask about VA home retention options, including the VA Partial Claim Program.
The servicer may request income documents, recent bank statements, a hardship explanation and proof that the hardship has ended or improved. If the borrower appears eligible, the servicer can begin the trial payment process and later submit the partial claim package to the VA for review.
Veterans who are already 61 days or more past due may also be assigned a VA loan technician, but waiting can reduce available options. Contacting the servicer early is usually the safer move.
Reasons a Partial Claim Could Be Denied
Approval is not automatic. A borrower may be denied if the home is no longer the primary residence, the hardship appears permanent, the borrower cannot afford future payments, or the requested amount exceeds the program limit.
Missing a payment during the three-month trial period can also jeopardize approval.
Incomplete paperwork may delay or weaken the case. Borrowers should make sure their hardship letter, income records and bank statements tell a consistent financial story.
The program is also generally limited to one partial claim per loan, with limited exceptions for certain disaster-related hardships.
What Veterans Should Consider Before Accepting
The biggest benefit is immediate mortgage recovery without a higher monthly payment. The biggest trade-off is that the deferred balance remains attached to the home.
That lien can matter later. If the borrower refinances, sells the property or pays off the mortgage, the partial claim balance must usually be resolved at that time.
For homeowners with strong equity, this may be manageable. For borrowers with limited equity or falling home values, it deserves closer review before making a decision.
Why This Program Matters Now
The VA Partial Claim Program 2026 fills a major foreclosure-prevention gap for veterans who fell behind but are not permanently unable to pay.
It does not erase mortgage debt and it will not solve every hardship. But for the right borrower, it can stop a temporary setback from turning into the loss of a home.
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The launch also comes as many homeowners continue to navigate higher borrowing costs and changing housing conditions. Recent mortgage and housing market trends have made it more difficult for some borrowers to recover from financial disruptions, increasing the importance of targeted relief programs.
Veterans seeking official guidance can review help for VA loan payment trouble through the U.S. Department of Veterans Affairs. Homeowners experiencing financial difficulty should contact their mortgage servicer as early as possible to discuss available VA home retention options before foreclosure proceedings advance.
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