VA Loan Updates

Question: When a veteran sells his property, who will assume the existing Department of Veterans Affairs loan? Is the veteran released automatically from personal liability for repayment of the loan?

Answer: No. If the loan closed after March 1, 1988, the lender or VA must be notified and requested to approve the assumer and grant the veteran release from liability. If the loan was closed prior to March 1, 1988, the loan may be assumed without approval from VA or the lender. However, the veteran is strongly encouraged to request a release of liability from VA to avoid owing a debt to the government if the loan assumer (or a subsequent assumer) fails to pay the loan. For more information on VA home loans, contact the VA at (800) 827-1000, or check out the VA Web site at www.homeloans.va.gov.

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