What Is the VA Partial Claim Program? 2026 Rules Explained

On June 15, 2026, the VA launched its new partial claim program, created by the VA Home Loan Program Reform Act that was signed into law on July 30, 2025. The program gives military members and veterans a path to get current on their mortgage without losing the original loan terms.

This article explains exactly how the VA partial claim 2026 program works, who qualifies, how it compares to a loan modification, and how to use the program to avoid foreclosure.

What Is the VA Partial Claim Program in 2026?

The VA partial claim program is a foreclosure-prevention tool that lets the Department of Veterans Affairs (VA) advance funds to cover a homeowner’s missed mortgage payments.

Instead of adding those missed payments to your loan balance at a new interest rate, the amount owed becomes a separate subordinate lien. Essentially, it acts as a second loan attached to your home with no monthly payments and no interest.

You only repay that subordinate lien when you sell the home, refinance the VA loan, or pay off the original mortgage. Until then, you pay nothing extra each month.

For military homeowners, this new program fills a critical gap. The Veterans Affairs Servicing Purchase (VASP) program (the previous foreclosure safety net) ended on May 1, 2025. Between VASP’s closure and the new law taking effect, homeowners who fell behind on their mortgage had limited options to avoid foreclosure.

The VA partial claim 2026 program is authorized for five years, through July 30, 2030, unless Congress extends it. VA loan issuers have until November 28, 2026 to fully implement it in their systems, but submissions open on June 15, 2026.

Who Qualifies for a VA Partial Claim?

Eligibility for a VA partial claim depends on a few key factors. Here’s what the program currently requires:

Loan type: The loan must be VA-guaranteed. Conventional, FHA, or USDA loans don’t apply.

Property type: The home must be your primary residence. Investment properties and second homes are not eligible.

Loan status: You must be in default or at imminent risk of default.

Ability to resume payments: The partial claim program can help you get current on your loan, but your regular monthly mortgage payment has to be something you can actually afford going forward. If the original payment is still too high for your current income, a partial claim alone may not be enough.

Trial payment plan: Under the program’s guidelines, borrowers must successfully complete a three-month trial payment plan before the partial claim is approved. This means making three consecutive on-time payments at the regular mortgage amount while the claim is being processed. This ensures that you can sustain the payment once your delinquency is cleared.

One-time use: The program is generally limited to one partial claim per loan. There’s an exception for hardships tied to a Presidential disaster declaration, which may allow a second claim in certain circumstances.

How the 25% Partial Claim Limit Works

The VA can advance up to 25% of the unpaid principal balance on your loan at the time of the partial claim. If you previously used a COVID-era partial claim or missed payments during the period of March 1, 2020 through May 1, 2025, that limit increases to 30%.

Here’s what that means in practice: if your remaining loan balance is $300,000, the VA can advance up to $75,000 to remove your delinquency (25% cap) or up to $90,000 if you qualify for the COVID-era expanded limit.

The advance can cover more than just missed principal and interest payments. The VA also allows the cure amount to include:

• Past-due property taxes
• Homeowners insurance premiums
• HOA dues, if applicable

If you owe more in missed payments than the 25% limit allows, a partial claim alone may not fully resolve the delinquency. In that case, your servicer and VA loan technician will evaluate whether a combination of tools might bridge the gap, like a partial claim plus loan modification.

VA Partial Claim vs. Loan Modification

If you’re behind on your VA mortgage payments, you might be wondering whether a partial claim or a loan modification makes more sense. The answer is that they solve different problems, and the right choice depends on what’s actually driving your delinquency.

VA Partial Claim

A partial claim can be the right tool when your hardship was temporary and your original monthly mortgage payment is still affordable. It removes your delinquency without changing your interest rate, remaining loan term, or payment amount. The missed payments move to a deferred lien, and you resume where you left off.

This is especially beneficial if you have a low mortgage interest rate. Because rates have jumped significantly since the COVID era, getting a loan modification today would likely mean resetting to a much higher rate, making your payment more expensive than it was before.

Loan Modification

A loan modification restructures the loan itself. The servicer and VA work together to change the terms by extending the loan term, adding missed payments to the principal balance, or in some cases, adjusting the rate. It’s often a better option than a partial claim if your current monthly mortgage payments are unaffordable.

However, there’s a downside. A loan modification in today’s rate environment often increases your payment, because missed payments are capitalized and the rate resets to current market levels. For homeowners locked into low rates, a modification can make things worse, not better.

How to Apply for a VA Partial Claim in 2026

The partial claim process runs entirely through your mortgage servicer, with VA oversight. There is no direct application portal for military homeowners on the VA website. If you want to take advantage of a partial claim, here’s how to do it:

Step 1: Call Your Loan Servicer

Contact your VA lender’s loss mitigation department and tell them you have a VA-guaranteed loan and want to discuss VA home retention options, including the partial claim program. Ask specifically whether they are currently processing partial claims. Most major servicers are prepared for the June 15, 2026, launch, but implementation will continue to roll out through late 2026.

Step 2: Request a Hardship Review

Your loan servicer will ask you to document your financial hardship. Be prepared to submit a letter explaining what caused the delinquency (job loss, medical event, death of a spouse, etc.), proof of current income, recent bank statements, and documentation showing the hardship has been resolved or stabilized.

Step 3: Evaluate Your Loss-Mitigation Options

VA loan issuers are required to evaluate you for a sequence of loss-mitigation options before proceeding to foreclosure. The partial claim is one step in that sequence. Your servicer will determine which options you’re eligible for based on your financial situation.

Step 4: Set Up a Trial Payment Plan

If you’re a good candidate for a partial claim, your loan servicer will typically place you on a three-month trial payment plan. You must make three consecutive on-time payments at your regular mortgage amount. Missing a trial payment can result in removal from the program.

Step 5: Loan Servicer Submits the Partial Claim to the VA

Once you complete the trial period successfully, your loan servicer submits the partial claim to the VA for review and approval. The VA evaluates your file against the program requirements and, if approved, advances the funds to cure the delinquency.

Step 6: The Subordinate Lien is Recorded

The advanced amount is recorded as a subordinate lien on your property. You receive written confirmation of the amount, terms, and when the amount is due. Your original mortgage becomes current, and you resume the regular payments.

What Happens After a Partial Claim is Approved?

Once your partial claim is approved and finalized:

• Your first mortgage is brought current. You owe no back payments on the primary loan.
• You receive a recorded lien document showing the subordinate debt amount, typically with language stating it accrues no interest and requires no monthly payments.
• You resume making your regular mortgage payment on the normal schedule.
• The subordinate lien balance becomes due in full when you sell the home, refinance, or pay off the first mortgage.

What this means for future refinancing: The subordinate lien will show up in a title search. When you eventually refinance, the lien balance will either need to be paid off at closing or paid from equity. If your home has appreciated, this is usually manageable. If your home has lost value, however, it’s worth discussing the implications with a VA lender before making any decisions.

What this means for your VA entitlement: As long as the first mortgage remains in good standing and no default occurs after the partial claim, your VA entitlement is not affected. If you default again after receiving a partial claim, the VA has the authority to reduce your available entitlement by any losses it sustains.

Common Reasons VA Partial Claims Get Denied

A partial claim isn’t automatically approved because you have a VA-backed loan and you’re behind on the payments. Here are some of the most common reasons borrowers are denied:

The Hardship Isn’t Temporary

If your income has permanently dropped and you can’t realistically make the regular mortgage payments going forward, the loan servicer and VA might determine that the partial claim doesn’t solve the underlying problem.

You Missed a Payment During the Trial Period

Missing even one payment during the three-month trial period can result in removal from the partial claim program. If you know you’ll struggle to make trial payments, it’s better to be honest with your servicer upfront and explore other options.

The Debt Exceeds the Cap

If the total amount needed to cure the default (including taxes, insurance, and fees) is greater than 25% (or 30% for COVID-era loans) of the unpaid principal balance, a partial claim may not fully cover it. Your servicer might need to combine the partial claim with another tool.

The Property Isn’t Your Primary Residence

If you’ve moved out of the home and it’s no longer your primary residence, the program doesn’t apply. Investment properties and rental conversions of former primary residences are excluded from the new VA partial claim program.

Documentation is Incomplete or Inconsistent

Hardship letters, income verification, and supporting documents need to be consistent with your stated situation. Inconsistencies can delay or derail a claim.

The Loan Has a Prior Partial Claim

The one-claim-per-loan limitation means if the loan was previously modified through a partial claim (including the COVID-era programs), a second claim is only possible in disaster-related circumstances.

FAQ

Q: Am I Eligible for a VA Partial Claim if I’m Behind on Payments?

Potentially, yes. You need a VA loan on your primary residence, a temporary hardship that has stabilized, the ability to resume your regular mortgage payments, and the ability to complete a three-month trial payment plan. Your servicer and a VA loan technician can review your specific situation and let you know if you’re eligible for the program.

Q: Does a VA Partial Claim Affect My Credit?

The partial claim itself won’t impact your credit score, but the underlying delinquency that led to it may already be affecting your credit. Once your loan is current and you resume on-time mortgage payments, you can begin rebuilding your credit.

Q: What Happens to the Subordinate Lien if I Default Again?

If you have a second default after receiving a partial claim, the VA can recover its losses and may reduce your future VA home loan entitlement by the amount lost.

Q: Can I Use a Partial Claim on a Rental Property I Used to Live in?

No. The VA partial claim program only applies to mortgages on your current primary residence. If you converted a former primary residence into a rental property, you can’t get a partial claim.

Q: How Can I Contact the VA About Partial Claims?

Call the VA Regional Loan Center at (877) 827-3702, Monday through Friday, from 8 a.m. to 6 p.m. ET. If your loan is 61 days or more past due, the VA will automatically assign a loan technician to your file, but don’t wait for that to happen. Reaching out early gives you more options.