On Veterans Day, we honor those who have served our country, but for some veterans, the Department of Veterans Affairs (VA) is causing financial strain instead of providing support. NPR reported that the VA has left thousands of veterans struggling with higher mortgage payments that they cannot afford.
Thousands of veterans have been affected by VA missteps, which raised monthly mortgage payments for 1,300 veterans by as much as 50%.
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Records gathered by NPR show that modified mortgages —originating after Oct. 1, 2022 — saw increases of $201 to $500 per month for nearly 1,500 veterans. Additionally, mortgages for 675 veterans rose by $100 to $200 per month.
One such veteran, Army veteran Natalie Donaldson, shared her experience with NPR. After placing her loan in forbearance during the pandemic to care for a sick relative, Donaldson was offered two options: She could either pay back $15,000 in missed payments or accept a modified loan with a much higher interest rate. Her payments shot up by $500 a month, a 50% increase.
“I bought a house I could afford, but now I can’t,” she told NPR.
The VA had initially told veterans who wanted forbearance that their missed payments would be added to the end of their loan term, but in October 2022, the VA changed its policy. As a result, many veterans, like Donaldson, are now stuck with unaffordable loan modifications.
Thousands of veterans were on the verge of foreclosure until a group of senators wrote a letter to the VA, asking the department to halt the foreclosures.
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In response, the VA launched a new “rescue” program offering veterans the chance to re-sign for loans at lower interest rates. However, this program only applies to veterans who did not accept a modified loan, thereby excluding Donaldson and many others who are still left with unaffordable payments.
The VA told NPR it doesn’t have the authority to include these veterans in the new program.
[Lauren Taylor]
ON VETERANS DAY, WE HONOR THOSE WHO HAVE SERVED OUR COUNTRY, BUT FOR SOME VETERANS, THE DEPARTMENT OF VETERANS AFFAIRS (VA) IS CAUSING FINANCIAL STRAIN INSTEAD OF PROVIDING SUPPORT.
NPR REPORTS THAT THE VA HAS LEFT THOUSANDS OF VETERANS STRUGGLING WITH HIGHER MORTGAGE PAYMENTS WHICH THEY CAN’T AFFORD.
THOUSANDS OF VETERANS HAVE BEEN HURT BY VA MISSTEPS, WHICH RAISED MONTHLY MORTGAGES FOR 1,300 VETERANS BY AS MUCH AS 50%.
RECORDS GATHERED BY NPR SHOWS MODIFIED MORTGAGES – THAT ORIGINATED AFTER OCTOBER 1, 2022, WERE RAISED BETWEEN $201 – $500 DOLLARS EXTRA PER MONTH FOR NEARLY 1,500 VETERANS AND MORTGAGES FOR 675 VETERANS INCREASED $100-$200 PER MONTH.
ONE SUCH VETERAN, ARMY VETERAN NATALIE DONALDSON, SHARED HER EXPERIENCE WITH NPR. AFTER PLACING HER LOAN IN FORBEARANCE DURING THE PANDEMIC TO CARE FOR A SICK RELATIVE, DONALDSON WAS OFFERED TWO OPTIONS: PAY BACK $15,000 IN MISSED PAYMENTS OR ACCEPT A MODIFIED LOAN WITH A MUCH HIGHER INTEREST RATE. HER PAYMENTS SHOT UP $500 A MONTH, A 50% INCREASE. “I BOUGHT A HOUSE I COULD AFFORD, BUT NOW I CAN’T,” SHE TOLD NPR.
THE VA HAD INITIALLY TOLD VETERANS WHO WANTED FORBEARANCE THAT THEIR MISSED PAYMENTS WOULD BE ADDED TO THE END OF THEIR LOAN TERM, BUT IN OCTOBER 2022, THE VA CHANGED ITS POLICY. AS A RESULT, MANY VETERANS LIKE DONALDSON ARE NOW STUCK WITH UNAFFORDABLE LOAN MODIFICATIONS.
THOUSANDS OF VETERANS WERE ON THE VERGE OF FORECLOSURE UNTIL A GROUP OF SENATORS WROTE A LETTER TO THE VA DEPARTMENT, ASKING THEM TO HALT THE FORECLOSURES.
IN RESPONSE, THE VA LAUNCHED A NEW “RESCUE” PROGRAM OFFERING VETERANS A CHANCE TO RE-SIGN FOR LOANS AT LOWER INTEREST RATES. HOWEVER, THIS PROGRAM ONLY APPLIES TO VETERANS WHO DIDN’T ACCEPT A MODIFIED LOAN, THEREBY EXCLUDING DONALDSON AND MANY OTHERS WHO ARE STILL LEFT WITH UNAFFORDABLE PAYMENTS. THE VA TOLD NPR IT DOESN’T HAVE THE AUTHORITY TO INCLUDE THESE VETERANS IN THE NEW PROGRAM.
WHILE THE VA’S MISSION IS TO HELP VETERANS, FOR TOO MANY, IT HAS MADE THEIR FINANCIAL BURDENS HEAVIER, LEAVING THEM WITH NO EASY WAY OUT.
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