VA Announces HAMP Program Details
January 28, 2010
On January 8, 2010, the US Department of Veterans Affairs (VA) released Circular 26-10-2, which provides instructions for modifying VA loans through the "Making Home Affordable Program". The two main features are the Home Affordable Refinance Program (HARP) and the Home Affordable Modification Program (HAMP).
VA expects servicers to exert all reasonable efforts to assist veteran borrowers in retaining ownership of their homes or mitigating losses when retention is not possible. Before considering VA HAMP, servicers must first evaluate defaulted mortgages for traditional loss mitigation actions including repayment plans, special forbearances, and traditional loan modifications. If the payments are affordable, then the traditional loss mitigation option will be used to help the veteran retain the home and avoid foreclosure. If none of the loss mitigation options provide an affordable payment, the servicer must evaluate the loan for a VA HAMP modification prior to deciding that the default is insoluble. VA expects servicers to complete all loss mitigation activities expeditiously, including those under review for HAMP modifications.
Circular 26-10-2: VA Making Home Affordable Program
US Department of Veterans Affairs
Megan Booth 202-383-1222, Jerome Nagy 202-383-1233