Becky Queen remembers opening the letter that contained the foreclosure notice.
“My heart was pounding,” she said, “and my hands were shaking.”
Queen is a resident of a tiny farmhouse in rural Oklahoma together with her husband Ray and their two children. Ray has been a U.S. Army veteran who was wounded in Iraq. Since the 1940s the government of America has been able to help veterans such as him to buy homes with their VA credit program which is run under the Department of Veterans Affairs.
However, the VA has placed this family at risk of losing their home.
“I wasn’t doing anything incorrectly,” says Ray Queen. “The sole thing I was doing was to trust an organization that I’m supposed to be able to trust for the mortgage.”
As with millions of Americans Like millions of other Americans, the Queens used COVID mortgage forgiveness, which let homeowners skip mortgage payment. It was enacted by Congress following the outbreak for those who lost their income.
However, the results of an NPR investigation has found hundreds of veterans who sought an exemption are now in danger loss of their houses because of without fault. Even though the VA is trying to find a solution to address the issue however for many it could be too for them to be able to afford it.
For the Queens the whole thing began in the month of September 2021 when Becky’s mom died from COVID-19. Becky had to take an extended break from work, and she was fired from her job.
In the year that followed, as their savings shrinking the couple phoned the company responsible for their mortgage, Mr. Cooper and were informed they could take a break for the payment for six months. After they had gotten back on track and began to pay The couple claims that they were informed that they would not owe the missed payments in one large lump amount.
“I specifically wanted to know “how did this work? ‘” says Becky Queen. “They have said that we’re going to take all your payments and we’re bundling them and we’ll add them together at the end.”
This means that the late payments would be shifted to the rear of their loan term, so they can then make the regular mortgage payments again.
However, this isn’t how it turned out.
In the month of October, 2022, the Department of Veterans Affairs ended the program known as Partial Claim Payment program, also known as PCP which enabled homeowners to claim this benefit. The decision was made despite the fact that housing industry, mortgage companies and veterans’ organizations all urged that the VA not to terminate the program. They said that hundreds of homeowners had to make up for late payments. The interest rates were so high that a lot of homeowners couldn’t be able to refinance their mortgages or get back on track in any other method.
Ray Queen says nobody told Ray Queen about this.
“How do you get that to happen?” Queen asked. “This should be an plan that everyone has to aid those in need to ensure that you don’t steal their home.”
The Queens claim that they attempted to get off their forbearance in February this year and to pay their mortgage. Both were working. However, they encountered issues at the loan company.
Then, in September the couple claims they were ordered to raise at least $22,000. isn’t what they have, or sell their house or go through foreclosure on it.
Their mortgage servicing company, Mr. Cooper stated in a statement that they “explored every avenue possible to come up with an option for this customer.” However, it added that the VA requires better options for reducing losses and directed NPR to an open letter from industry, advocates and veteran groups calling on the VA to relaunch PCP. PCP program.
The VA “has been a real liar” to people down.”
“The Department of Veterans Affairs has been a complete disappointment to the veterans,” says Kristi Kelly an attorney for consumers in Virginia who claims she’s hearing from many other veterans who are in the same situation like Ray or Betsy Queen.
“The homeowners who signed COVID-related forbearances. They given certain guarantees and also certain statements provided,” says Kelly. “And the VA basically removed the rug from underneath everyone.”
Some homeowners may find stopping the program could not lead to the foreclosure process, but it could be a financial burden.
“Many of them are in the middle of 2 to 3% interest-rate loans,” Kelly says. Through the PCP program, they can keep the same interest rate. Now she explains that the only way to be in a position to save their home is to go to a loan modifications in which the interest rate is similar to the current price of 7.5 percent.
“For the majority of people, payment will rise by between $600 and $700 per month due to the fact that the VA has opted to end part-claim programs.”
A lot of homeowners cannot afford a massive increase in their monthly mortgage.
According to data from the company ICE Mortgage Technology, 6,000 homeowners who have VA loans that had COVID forbearances at present are being considered for foreclosure. And 34,000 more are delinquent.
Kelly says that most homeowners in America — those with FHA loan, for example or loans that are backed by Fannie Mae and Freddie Mac There are still ways to avoid foreclosure by transferring late payments to the end of the loan’s terms.
However, homeowners who have VA loans aren’t affected, since the VA has ended the program. Therefore, veterans are treated differently than other home owners, Kelly said.
“Service participants are put in the place that they’ll have to leave their homes,” she says. “And for the vast majority of people, that’s what they’ve worked for — and their entire wealth is located in home ownership.”
VA has plans to assist but it may be too for now.
The Department of Veterans Affairs says that it was forced to close the program.
“We were granted a limited authorization for this particular program in the course of COVID,” says John Bell who is the director of the executive office of the Veterans Benefits Administration’s Loan Guaranty Service. “It wasn’t our regular power.”
A few in the industry believe that the VA actually did have the power for the extension of this program. In any case the VA ended it.
But, for now it appears that the VA is taking the issue seriously.
NPR has been informed it has learned that VA is currently working to develop a brand new plan that will replace the current one. It’s designed to work in a different manner, but in the same way, and to stop people from going through foreclosure. Bell claims it will take anywhere from four to five months before it is operational.
This is too long for a majority of the more than 6,000 VA homeowners who are already in foreclosure. In addition, there are many others who are in default.
Data indicates that a greater number of VA homeowners are headed into foreclosure since VA stopped the PCP program. However, this is not the case for FHA loans, or loans that are that are backed with Fannie Mae as well as Freddie Mac.
Is the firetruck arriving too late?
With numerous homeowners at risk There’s a growing pressure for the VA to stop granting loans to veterans until they get their fixed and operational.
“There ought to be a stop to foreclosures” declares Steve Sharpe who is a senior attorney with the National Consumer Law Center. “Veterans must be given the option to participate in this program when it’s on the market because it’s been so long since they’ve seen something that actually worked.
Sharpe states that Sharpe says the VA may also be able to restart the PCP program after was shut down. “They are able to perform both of these things,” Sharpe says.
The idea of putting off foreclosures for a while is an ideal idea for the seasoned Ray Queen in Oklahoma.
“Let us continue to pay for our mortgage in the meantime and when we get to that point,” he says. “Then after the VA is able to fix the issue, we’ll be able to return and deal with the issue. It seems like the right and mature option to not put your family through the wringer of hell.”
NPR repeated Ray Queen’s request at John Bell at the VA directly. Bell confirmed that”the VA is “exploring every option at the moment.”
“We are obligated for our veteran veterans to ensure that we give them every chance to stay at home,” Bell said.
Ray as well as Becky Queen are hoping the VA allows people to remain in their houses till the program is able to provide them with a means to make payments on their mortgages. Since if a firetruck turns up after the home is burned to the ground the house isn’t going to help hundreds of vets and military members in need of help right today.
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