21.05 VA DISASTER LOAN MODIFICATION (02/01/18)

Owned by Kacey Olson
Nov 24, 2018
1 min read

© VA Servicers Handbook - M26-4

a. The VA Disaster Loan Modification allows servicers to extend permanent payment relief to impacted delinquent borrowers when the borrower has not submitted a complete loss mitigation application. All impacted borrowers should have an opportunity to be considered for a VA Disaster Loan Modification as long as eligibility requirements are met.
b. Evaluation of Borrower - Servicer evaluation of the borrower’s financial information is not required. Pre-approval is automatically granted for 38 C.F.R. 36.4315(a)(3) requiring borrower’s creditworthiness to be evaluated under the criteria specified in 38 C.F.R. 36.4340.
c. If eligible for the VA Disaster Loan Modification program, borrowers must successfully complete a 3-month Trial Payment Plan (TPP) period, and sign the VA Disaster Loan Modification Agreement in order to receive a permanent loan modification.
d. Servicers are encouraged to continue VA Disaster Loan Modification solicitation efforts throughout the delinquency, and the foreclosure process, up to 12 months after the federally-declared disaster.