Grants to Help Veterans Avoid Foreclosure

Veterans can receive assistance from the government for foreclosure prevention. While there are no actual cash grants available to help avoid foreclosure, the government and state programs provide various other forms of financial relief for eligible veterans. For some of these programs, the defaulted loan does not have to be guaranteed by the Department of Veterans Affairs. Laws have also been enacted to assist servicemembers or those whose deployment has ended, with extended time to resolve financial obligations. Free legal counsel has also been made available to veterans and servicemembers to provide guidance on how a foreclosure will impact them.

The Department of Veteran Affairs (VA) offers several assistance options for veterans facing foreclosure. This assistance is for home loans that have a VA guarantee. The VA can provide a "compromise claim payment," which is the difference between the market value of a home and what is owed on the mortgage to complete the sale of a home. Vets also have the option to be released from all further liability by transferring ownership to the VA with a deed in lieu of foreclosure. There is no grants program offered through the VA that provides direct payment assistance for mortgages.

The Helping Heroes Keep Their Homes Act prevents lenders from foreclosing on the homes of servicemembers and the surviving families of deceased servicemembers within nine months of their military service ending. The Act has effect until December 15, 2015.

The federal Making Home Affordable Program assists distressed homeowners with modifying and refinancing the mortgage of their home. The program also provides mortgage payment assistance for unemployed homeowners and assists with the short sale of a home. Veterans can benefit from these programs as well as the general population as long as eligibility requirements are met. Also, the Hardest Hit Fund and the Emergency Homeowners Loan program have allocated funding to certain states to assist homeowners' with deferred or no payment loan options.

Stateside Legal is a website that offers self-help and free legal counsel to active servicemembers, veterans and military families facing foreclosure. Legal assistance may not be available in every state. A veteran can obtain a referral to a local attorney who can provide guidance on the best way to resolve their financial obligations. The website is funded by the Legal Services Corporation and volunteers consist of private attorneys, members of the Judge Advocate General Corps (JAG) and veteran service officers.