• Donna Schmidt

Announcing the VA Covid Partial Claim Program is happy to announce that we are now able to calculate the new VA Partial Claim.

VA is establishing a temporary program, the COVID-19 Veterans Assistance Partial Claim Payment (COVID-VAPCP), to assist veterans exiting forbearance due, directly or indirectly, to the COVID-19 disaster. The program takes effect July 27, 2021. The program closely resembles FHA’s COVID-19 Partial Claim program. Veterans are allowed a partial claim up to 30% of their unpaid principal balance at the time the veteran entered into a COVID-19 forbearance. The COVID-VAPCP must be repaid in full upon the refinancing, maturity or payment in full of the guaranteed loan. A partial claim cannot be paid off through a loan modification of the guaranteed loan. The partial claim is a no-interest loan for the veteran and a financial evaluation of the borrower is not required to offer a COVID-VAPCP.

VA will only pay one partial claim payment per guaranteed loan and only one partial claim payment per veteran. The COVID-VAPCP is not an option of last resort and can be offered to veterans, even if other home retention options are feasible. VA will not require servicers to keep written record of the servicer’s justification that the partial claim was superior to every other home retention option. In other words, VA has not prescribed a waterfall of home retention options.


- Must be current or less than 30 days past due on March 1, 2020

o Loans made on or after March 1, 2020 are also eligible

- The veteran received a COVID-19 forbearance and missed at least one scheduled monthly payment

- There remains at least one scheduled monthly payment that the veteran did not make while under a COVID-19 forbearance

- The veteran can resume making scheduled monthly payments, on time and in full

- The veteran occupies the property securing the guaranteed loan as their primary residence

The COVID-VAPCP must include all scheduled monthly payments (principal, interest and escrow payments for real estate taxes and insurance premiums) due within 31 days of the date the servicer provides to the note and security instrument to the veteran. The partial claim must include the full amount of indebtedness necessary to bring the loan current.

The COVID-VAPCP program has a sunset date of October 28, 2022. This will be the deadline for servicers to request a partial claim. Servicers have 120 days from the date a veteran exists a COVID-19 forbearance to request a partial claim. Servicers must utilize VALERI to report the partial claim payment event within seven days of the date the veteran returns the executed note to the servicer.

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