VA borrowers affected by Hurricane Irene or other natural disasters should contact the Department of Veterans Affairs as soon as possible to learn what help is available for disaster recovery, VA loan assistance, and help with foreclosure avoidance.

VA borrowers in need of post-disaster advice or information should contact their nearest VA Regional Loan Center toll-free at (877) 827-3702.

The VA official site says, “VA encourages holders of guaranteed loans in disaster areas to extend every possible forbearance to borrowers in distress through no fault of their own.”

Did you know there are special rules that, under the right circumstances, could help prevent a VA loan default in such cases? According to the Department of Veterans Affairs, title 38, Code of Federal Regulations (CFR), section 36.4311, “allows the reapplication of prepayments to cure or prevent”  VA loan default.

What does that mean? “If a borrower has been making additional principal payments over a period of years, the principal balance may be increased up to the scheduled balance and the increase applied toward regular installments.”

But there’s also a potential source of help for those who haven’t made additional payments. The VA official site says “38 CFR 36.4315 (Loan modifications) allows the terms of any guaranteed loan to be modified without the prior approval of VA, provided certain conditions in the regulation are satisfied.” If you’ve been through a natural disaster, contact your loan officer to see about VA loan modification if needed–you may find some help based on your circumstances as you try to recover from the disaster.

Another source of possible assistance for VA borrowers comes in the form of waived late payment charges. “VA encourages servicer to waive late charges on loans affected by the disaster. VA  further requests that credit reporting be suspended for borrowers whose loans are deemed to be affected by the disaster.”

The language of these statements on the VA official site implies that such actions by the lender are voluntary, but if you need help in this area contact your VA Regional Loan Center and see what intervention help may be available on your behalf by the VA.

Again, VA borrowers recovering from a natural disaster should contact their lender and the VA as soon as possible after in the recovery phase. Contact the nearest VA Regional Loan Center near you by calling (877) 827-3702.

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