What servicers need to know as implementation begins

The Department of Veterans Affairs (VA) has announced that servicers may begin submitting loans under the new VA Partial Claim Program beginning June 15, 2026. The announcement represents a significant milestone in the implementation of a foreclosure prevention program authorized by Congress through the 2025 VA Home Loan Program Reform Act.

The new program restores an important loss mitigation option for veterans experiencing financial hardship while providing servicers with an additional tool to help borrowers remain in their homes.

What Is the VA Partial Claim Program?

Under the Partial Claim Program, VA advances funds to cure a borrower's delinquency and bring the mortgage current.

In exchange, the borrower executes a subordinate lien in favor of VA. The partial claim balance is generally repaid when the property is sold, refinanced, or the first mortgage is otherwise satisfied.

The program is intended to provide a sustainable home-retention solution for eligible veterans who have experienced financial hardship but are able to resume regular mortgage payments.

Key Implementation Dates

While servicers may begin submitting loans under the program on June 15, 2026, VA has recognized that operational implementation will require significant preparation.

To support the transition, VA has established an implementation period extending through November 28, 2026. During this period, servicers are expected to update systems, procedures, and training programs necessary to support the program's requirements.

Operational Considerations for Servicers

As implementation begins, servicers should evaluate several key areas:

Technology Readiness

Organizations should review servicing platforms, document generation processes, workflow automation, and reporting capabilities to ensure they can accommodate the new program requirements.

Policy and Procedure Updates

Existing loss mitigation policies and procedures should be reviewed and revised to incorporate Partial Claim Program requirements and eligibility criteria.

Staff Training

Personnel responsible for borrower outreach, loss mitigation reviews, document preparation, and quality control should receive training on the new program and associated operational workflows.

Vendor Coordination

Servicers relying on third-party technology providers, document vendors, or servicing partners should confirm implementation timelines and readiness plans.

Why This Matters

The return of a VA partial claim option provides a meaningful foreclosure prevention alternative for veteran borrowers while expanding the loss mitigation toolkit available to servicers.

For organizations servicing VA loans, preparation now can help ensure a smoother implementation process and reduce operational challenges as program volume increases.

Looking Ahead

With the June 15 launch date now established, servicers should use the implementation window to assess readiness, identify operational gaps, and establish processes that support compliant execution.

Organizations that prepare early will be better positioned to support borrowers effectively while maintaining operational efficiency as the new program becomes part of the servicing landscape.

For additional information regarding the VA Partial Claim Program, visit the VA's housing assistance resources.

As servicers prepare for implementation, Propel's comprehensive loss mitigation library can help support compliant documentation and operational readiness. To learn more about Propel's loss mitigation capabilities, connect with the Asurity team.