What is a VA loan?

20 Oct What is a VA loan?

A VA loan is a loan guaranteed by the Veteran’s Administration. In consideration for the lenders’ participation in the profits and guarantees of the government-insured loan program, the lender agrees to provide certain loan servicing functions as described in the VA’s Lender Handbook.

The servicing functions include extending to the borrower all reasonable means of forbearance, including an opportunity to apply for a mortgage foreclosure avoidance workout and consideration of a temporary suspension of borrower’s payments of extension of the loan.

The servicer is required to establish timely and helpful and responsive telephone contact with the delinquent borrowers to determine why payments were not made on the mortgage. Alternatively, the servicer may arrange a face-to-face meeting with the borrower to evaluate the prospects for curing the mortgage default. The staff should be trained in techniques of loan servicing that include the pursuit alternatives to foreclosure in an effort to allow veterans to maintain their homes.

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Chip Parker is the managing partner of Parker & DuFresne, P.A., where he represents Northeast Florida businesses and consumers facing bankruptcy, and homeowners facing foreclosure. His firm files more homeowners in the Mortgage Modification Mediation Program than any other law firm in Northeast Florida. Parker is the recipient of Jacksonville Area Legal Aid's prestigious Award for Outstanding Pro Bono Service. Mr. Parker is an active member of the National Association of Consumer Bankruptcy Attorneys and National Association of Consumer Advocates.
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