ALL HANDS ON DECK! The grim reality of the VA's VASP program and how you can help KOVH protect veteran families.

The VASP (Veterans Affairs Servicing Purchase) program is designed to help veterans and their families avoid foreclosure, but as you pointed out, the strict eligibility criteria often limit who can benefit from it. Specifically, the requirement that borrowers cannot be in active bankruptcy creates a significant barrier for many veteran families who turned to bankruptcy during the pandemic as a last resort to manage overwhelming debt. My family is part of this group, making it even more difficult to not try and spend every day trying to do something.

Why Does This Requirement Harm Veterans and Their Families?

1. Bankruptcy as a Survival Tool: For many veterans, filing for bankruptcy after the COVID-19 pandemic was a strategic decision to avoid losing their homes and to cope with other financial hardships. By excluding these families, the VASP program penalizes them for taking a legal and responsible step to manage debt.

2. Increased Risk of Homelessness: Veterans in bankruptcy are often those who are most in need of mortgage assistance. Denying them access to the VASP program leaves them vulnerable to foreclosure, which increases the risk of homelessness among veteran families—a problem that organizations like KOVH are working hard to prevent.

3. Limited Lender Engagement: Many lenders do the bare minimum required by law to assist borrowers. This leaves veterans with high monthly payments they cannot afford, often without meaningful options to restructure their loans or reduce their payments. Programs like VASP should push for more lender accountability, but instead, they often fall short.

4. No Path for Financial Recovery: Veterans who filed for bankruptcy usually did so to gain some breathing room and restructure their debt. Excluding them from VASP removes a potential lifeline and prevents them from stabilizing their finances and keeping their homes.

How Policies Could Be Improved:

1. Remove or Adjust the Bankruptcy Restriction: Allow veterans in bankruptcy to participate in the program, especially if they can demonstrate a stable source of income or a viable repayment plan.

2. Mandate Better Lender Support: Require lenders to offer meaningful loan modifications or forbearance options beyond the bare minimum.

3. Extend Assistance to Pandemic-Affected Borrowers: Recognize the lasting economic impact of the pandemic and provide targeted assistance to those who were financially devastated by it.

4. Collaboration with Nonprofits: Work with organizations like KOVH to understand the real challenges veteran families face and create policies that address their needs.

With your help, KOVH can highlight these issues and push for more inclusive policies that truly support veteran families in need. We are literally the ONLY nonprofit committed to and determined to END all VA foreclosures, correct poor and financially abusive regulations and legislation, while holding congress to their jobs and lenders and investors accountable for their actions and ultimately inactions.