Legal Alert

VA Extends COVID-19 Foreclosure and Eviction Moratoriums and Addresses Borrower Relief

by Richard J. Andreano, Jr.
June 27, 2021

In Circular 26-21-10 dated June 25, 2021, the U.S. Department of Veterans Affairs (VA) extended the eviction and foreclosure moratorium for properties secured by VA guaranteed loans from June 30, 2021 to July 31, 2021. The moratoriums do not apply to vacant or abandoned properties.

The VA advises that “servicers must continue to work with VA and borrowers to consider all possible options to help borrowers retain their homes, or when that is not feasible, to mitigate losses by pursuing alternatives to foreclosure.” When a servicer reports a foreclosure sale date scheduled event in the VA Electronic Reporting Interface, a pre-foreclosure review is initiated. A VA technician will review the case and assist the borrower with pursuing home retention options and, when such options are not feasible, alternatives to foreclosure.

For borrowers who have not received a COVID-related forbearance as of the date of the Circular, servicers “should allow such borrowers to receive a COVID-related forbearance if the borrower makes the request no later than September 30, 2021.”

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