Revisions to Chapter 5 of VA M26-4, VA Servicer Handbook

Veterans Benefits Administration sent this bulletin at 05/09/2024 06:09 PM EDT

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U.S. Department of Veterans Affairs

Greetings,

The purpose of this communication is to announce an update to VA Manual 26-4, (VA Servicer Handbook) Chapter 5 Loss Mitigation. 

Purpose: VA is publishing this update to inform and clarify:

  • A change from the term ‘compromise sale’ to ‘short sale’ throughout the chapter.
  • Details on reporting home retention events using the bulk upload template and the National Emergency Declaration (NED) RFD.
  • The added reference to Appendix F and the VA Home Retention Waterfall in section 5.01.  
  • Removal of former section 5.02 Servicer Reporting Requirements.
  • The repayment plan process for loans impacted by a National Emergency Declaration in section 5.03.
  • The special forbearance process for loans impacted by a National Emergency Declaration in section 5.04.
  • The pre-approval process for loan modification and include and describe a new 40-year modification option in section 5.05.
  • The short sale process in section 5.07.
  • Removal of former section 5.10 Notice of Value (NOV) Extension – Alternatives to Foreclosure.

Servicers may immediately implement these loss mitigation guidelines.

The updates are available on our website: https://benefits.va.gov/WARMS/M26_4.asp

Sincerely,

Loan Guaranty Service