I 
119TH CONGRESS 
1ST SESSION H. R. 1815 
To amend title 38, United States Code, to authorize the Secretary of Veterans 
Affairs to take certain actions in the case of a default on a home 
loan guaranteed by the Secretary, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
MARCH 3, 2025 
Mr. VAN ORDEN introduced the following bill; which was referred to the 
Committee on Veterans’ Affairs 
A BILL 
To amend title 38, United States Code, to authorize the 
Secretary of Veterans Affairs to take certain actions 
in the case of a default on a home loan guaranteed 
by the Secretary, and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘VA Home Loan Pro-
gram Reform Act’’. 
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SEC. 2. AUTHORITY OF THE SECRETARY OF VETERANS AF-
FAIRS TO TAKE CERTAIN ACTIONS IN THE 
CASE OF A DEFAULT ON A HOME LOAN GUAR-
ANTEED BY THE SECRETARY. 
(a) IN GENERAL.—Section 3732 of title 38, United 
States Code, is amended— 
(1) in subsection (a)— 
(A) in paragraph (1), by striking ‘‘obliga-
tion’’ each place it appears and inserting 
‘‘loan’’; 
(B) in paragraph (2)— 
(i) by amending subparagraph (A) to 
read as follows: 
‘‘(A) The Secretary may, under terms and conditions 
as determined by the Secretary— 
‘‘(i) pay the holder of a loan guaranteed under 
this chapter an amount necessary to avoid the fore-
closure of such loan; 
‘‘(ii) require the holder of the loan and the vet-
eran obligated on the loan to execute all documents 
necessary to ensure the Secretary obtains a secured 
interest in the property covered by the loan; and 
‘‘(iii) require the holder of the loan to take any 
actions necessary to carry out this paragraph, in-
cluding preparing, executing, transmitting, receiving, 
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and recording documents, and requiring the holder 
of the loan to place the loan in forbearance.’’; 
(ii) in subparagraph (B), by striking 
‘‘obligation’’ each place it appears and in-
serting ‘‘housing loan’’; and 
(iii) by adding at the end the fol-
lowing new subparagraphs: 
‘‘(C)(i) Any decision by the Secretary under this 
paragraph is final and is not subject to judicial review. 
‘‘(ii) For purposes of section 511 of this title, any 
decision under this paragraph shall not be treated as a 
decision under a law that affects the provision of benefits. 
‘‘(D)(i) The Secretary may establish standards for 
processing payments under this paragraph based on a cer-
tification by a holder of a loan guaranteed under this 
chapter that the holder has complied with all applicable 
requirements established by the Secretary. 
‘‘(ii) The Secretary shall carry out, on a random-sam-
pling basis, post-payment audits to ensure compliance 
with all requirements described in clause (i).’’; and 
(C) in paragraph (5), by striking ‘‘obliga-
tion’’ and inserting ‘‘loan’’; 
(2) in subsection (c)(10)(B)(i), by striking 
‘‘forebearance’’ each place it appears and inserting 
‘‘forbearance’’; and 
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(3) by adding at the end the following new sub-
section: 
‘‘(d) The Secretary shall prescribe loss mitigation 
procedures, including a mandatory sequence in which the 
holder of a loan guaranteed under this chapter shall offer 
loss mitigation options (including an option to enter into 
a partial claim agreement under the VA Home Loan Pro-
gram Reform Act) to a veteran, to help prevent the fore-
closure of such loan. The Secretary may not purchase an 
entire such loan until the veteran has completed such se-
quence.’’. 
(b) RELATIONSHIP
TO OTHER POWERS
OF SEC-
RETARY.—Section 3720 of such title is amended— 
(1) in subsection (a), by striking ‘‘Notwith-
standing’’ and inserting ‘‘Except as provided in sub-
section (h), notwithstanding’’; 
(2) by redesignating subsections (f) through (h) 
as subsections (e) through (g), respectively; and 
(3) by adding at the end the following new sub-
section (h): 
‘‘(h) The Secretary may not take any action under 
paragraph (2),(3),(4), or (5) of subsection (a) with respect 
to a loan guaranteed under this chapter before the comple-
tion of the sequence of mitigation options offered to the 
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veteran to whom the loan is made under section 3732(d) 
of this title.’’. 
SEC. 3. PARTIAL CLAIM PROGRAM OF THE DEPARTMENT 
OF VETERANS AFFAIRS. 
(a) ESTABLISHMENT.—The Secretary of Veterans 
Affairs shall carry out a program, to be known as the 
‘‘Partial Claim Program’’, under which the Secretary may 
make a partial claim, described in subsection (b), with re-
spect to a loan— 
(1) guaranteed under chapter 37 of title 38, 
United States Code; 
(2) regarding the primary residence of the bor-
rower; and 
(3) that the Secretary determines is in default 
or at imminent risk of default. 
(b) PARTIAL CLAIM DESCRIBED.—A partial claim 
described in this subsection is the purchase by the Sec-
retary of a portion of indebtedness under the guaranteed 
loan, under which— 
(1) the borrower of the guaranteed loan enters 
into an agreement under subsection (c); 
(2) the Secretary pays the holder of the guaran-
teed loan the amount of indebtedness, subject to 
subsection (d), that the Secretary determines nec-
essary to help prevent or resolve a default; and 
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(3) the Secretary receives a secured interest in 
the property, subordinate to the first lien guaranteed 
loan, serving as collateral for the guaranteed loan. 
(c) AGREEMENT BETWEEN BORROWER AND SEC-
RETARY.—An agreement under this subsection is an 
agreement by the borrower of the guaranteed loan to repay 
the Secretary the amount determined under subsection 
(b)(2) at the end of the period of such guaranteed loan, 
subject to the following annual interest: 
(1) If the borrower agrees to make monthly 
payments beginning not later than three years after 
the date on which the Secretary makes the payment 
under subsection (b)(2), 0 percent. 
(2) If the borrower does not agree to a repay-
ment plan under paragraph (1), or fails to comply 
with such a repayment plan, 0.5 percent. 
(d) ADMINISTRATION OF PARTIAL CLAIM.— 
(1) AMOUNT OF CLAIM.—The amount of a par-
tial claim under this section with respect to a loan 
guaranteed under such chapter may not exceed 20 
percent of the unpaid principal balance of the guar-
anteed loan on the date on which the partial claim 
is made. 
(2) ONE PARTIAL CLAIM PER LOAN.—The Sec-
retary may make only one partial claim per loan. 
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(3) NOT AN ADVANCE.—The Secretary may not 
structure a partial claim as an advance on a new 
loan guaranteed under such chapter. 
(4) APPLICATION
OF
CLAIM.—A holder of a 
loan guaranteed under such chapter who receives a 
partial claim under this section with respect to such 
loan shall apply the payment first to arrearages, if 
any, on the guaranteed loan, which may include any 
additional costs (such as taxes, insurance premiums, 
or homeowner’s dues) the Secretary determines nec-
essary to prevent or resolve a default. 
(5) AUTHORITY TO CONTRACT.—The Secretary 
may enter into a contract with an entity for service 
of a partial claim under this section. Such entity 
shall provide quarterly statements to the borrower. 
(e) REQUIREMENTS OF LOAN HOLDER.— 
(1) ESTABLISHMENT
OF
CLAIM.—The Sec-
retary may require the holder of a loan, regarding 
which the Secretary makes a partial claim under this 
section, to take any actions necessary to establish 
the partial claim, including preparing, executing, 
transmitting, receiving, and recording loan docu-
ments. 
(2) COMPENSATION
OF
HOLDER.—The Sec-
retary shall compensate the holder of such a loan 
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appropriately, as determined by the Secretary, for 
the services required of such holder under this sub-
section. 
(3) EXERCISE
OF
POWERS.—The Secretary 
may exercise the authority of the Secretary under 
this subsection without regard to any other provision 
of law not enacted expressly in limitation of this sec-
tion that would otherwise govern the expenditure of 
public funds. 
(f) DEFAULT AND FORECLOSURE.— 
(1) DEFAULT.— 
(A) IN
GENERAL.—Notwithstanding sec-
tion 3703(e) of title 38, United States Code, an 
individual who defaults under a partial claim 
made under this section shall be liable to the 
Secretary for any loss suffered by the Secretary 
resulting from such default, and such loss may 
be recovered in the same manner as any other 
debt due the United States. 
(B) REDUCTION
OF
ENTITLEMENT.—In 
the event of default by an individual under a 
partial claim made under this section, the Sec-
retary may reduce the aggregate amount of 
guaranty or insurance housing loan entitlement 
available to the individual under such chapter. 
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