WASHINGTON–The Trump Administration said it is ending the Veterans Affairs Serving Purchase (VASP) program, which was started under the Biden administration and intended to help keep veterans struggling to pay their mortgages in their homes.
The Veteran Administration said it will stop accepting new participants in VASP on May 1.
“This change is necessary because VA is not set up or intended to be a mortgage loan restructuring service,” VA press secretary Pete Kasperowicz said in a statement. He added the VASP program was “unilaterally created by the Biden administration and lacks congressional authority.”
“This action will not affect any of the program’s existing participants, nor will it impact any eligible veterans who complete their VASP enrollment prior to May 1, 2025,” Kasperowicz added.
In 2024 the Biden administration said it created VASP after thousands of veterans who used COVID-19 pandemic-era programs to defer mortgage payments were at risk of losing their homes after the pandemic programs ended, reported NPR, which was first to report on the new program.
‘Unaffordable Bills’
“The pandemic programs allowed veterans with a VA-backed home loan who lost their normal stream of income to skip mortgage payments for months and move the missing payments to the end of their loan term,” NPR stated. “But when the last of those programs was shuttered in October 2022, thousands of veterans started receiving unaffordable bills for mortgage payments they missed.”
The Biden administration insisted it could not restart what was called the Partial Claim Payment program without congressional authorization, so it created the VASP program as a solution, the report added.
Under VASP, the VA purchased delinquent loans from holders and became the primary loan servicer, providing borrowers a stable payment plan at a fixed rate of 2.5% for the remainder of their loan.
The program helped more than 17,000 veterans stay in their homes, according to the VA.
Republican Opposition
Congressional Republicans, however, have been critical of the program, arguing that when the VA becomes the loan holder it puts taxpayer dollars at unacceptable risk. The VA purchased about $5.5 billion worth of loans through the program, according to the department.
