According to NPR, the Trump administration ended the Veterans Affairs Servicing Purchase (VASP) program without congressional action.
More than 26,000 U.S. military veterans are now paying more each month on their mortgages, with many seeing increases of $1,000 or more, after the administration eliminated a program intended to help veterans experiencing financial hardship.
NPR reported that the Department of Veterans Affairs and House Republicans had been warned that ending the program without a replacement could drive up payments and increase foreclosures.
What changed for veteran borrowers
The VASP program was designed to help veterans who had fallen behind on VA-backed home loans by rolling missed payments into a new mortgage with a 2.5% interest rate, far below the roughly 7% rates common in the market.
The program was launched by the Biden administration after its own mistake pushed thousands of veterans into higher mortgage payments.
According to NPR, the Trump administration ended VASP without action from Congress, though some House Republicans had strongly opposed it and wanted it eliminated. The program was shut down after a congressional hearing in which mortgage industry and housing advocates cautioned that ending it without a workable alternative would raise monthly payments and lead to more foreclosures.
What the data showed
NPR examined more than 40,000 VA loan modifications from May 2025 through September 2026. The review found that 63% of veterans who received a loan modification ended up with higher monthly payments. By comparison, only 2% of borrowers with loans guaranteed by Fannie Mae and Freddie Mac, which make up most of the U.S. mortgage market, saw higher payments after modifying their loans.
Of the more than 26,000 veterans whose payments increased, over 15,000 saw their monthly bills rise by at least $150. For more than 700 veterans, monthly mortgage payments climbed by $1,000 or more.
VA loan foreclosures reach a 10-year peak
NPR also reported that foreclosures on VA loans reached a 10-year high after the VA ended VASP.
In a statement to NPR, the VA said it helps thousands of veterans “retain homeownership and/or avoid foreclosure through programs like payment forbearance, loan modifications and individualized repayment plans.”
“Many leading voices in Congress supported the termination of VASP, which put the entire VA home loan program at risk,” a VA spokesperson said.
New relief program does not fix earlier harm
After VASP was shut down, Congress created a new VA Partial Claim Program to help struggling veterans by moving missed mortgage payments to the end of their loans. But NPR said it took the VA more than 13 months to set up the new program, which began in June. Even now, most mortgage servicers do not offer it because they were given six months to put it in place.
The new program also does not help the more than 26,000 veterans whose loans were already modified and who are now facing higher monthly payments.
The Source: This report includes information from NPR.
More from Digilifetrends
Retirees Are Finding Affordable Riverfront Living in Bullhead City, Arizona
Some retirees are passing over crowded coastal destinations and choosing a place that is warmer, less expensive, and close to the water. A low-key city on the Colorado River in…
11 min read · Published 2026-10-30How a $2,000 Social Security Benefit Can Be Treated as $2,500 for a Mortgage
Fannie Mae guidelines allow lenders to add 25% to documented nontaxable Social Security income, which can turn a $2,000 monthly benefit into $2,500 of qualifying income.
5 min read · Published 2026-10-30How Social Security Income Can Be Counted Higher for a Mortgage
Mortgage lenders are not required to use a retiree’s Social Security benefit at face value, and that difference can decide whether she qualifies for the home she wants.
4 min read · Published 2026-10-30