VA Servicer Handbook M26-4 Chapter 5 — Loss Mitigation

va-m26-4-ch05

VA Pamphlet 26-4 Chapter 5 governs loss mitigation on VA-guaranteed loans.

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source:
  type: regulation
  id: va-m26-4-ch05
  authority: VA Servicer Handbook M26-4 Chapter 5 — Loss Mitigation
  description: |
    VA Pamphlet 26-4 Chapter 5 governs loss mitigation on VA-guaranteed loans.
obligations:
  - id: va-m26-4-ch05-offer-special-forbearance
    canonical_id: va-m26-4-ch05-offer-special-forbearance
    section: VA M26-4 Ch. 5.03, Subsection c — Special Forbearance Duty to Offer
    description: |
      [SERVICER] must offer the Special Forbearance when the borrower
      indicates they can repay the missed payments in a lump sum, as
      outlined on the VA Home Retention Waterfall.
    type: do
    audit_question: For every VA-guaranteed loan in reportable default where the borrower indicates ability to repay missed payments in a lump sum, can [SERVICER] evidence that a Special Forbearance offer was extended consistent with the VA Home Retention Waterfall?
    program_review: Does the loss-mit program account for the waterfall trigger — offer Special Forbearance when the borrower indicates ability to repay the missed payments in a lump sum, consistent with the VA Home Retention Waterfall?
    file_review: Start with the servicing notes to confirm the lump-sum indication and that a Special Forbearance offer followed per the waterfall. The officer judges whether the waterfall was correctly applied to the borrower's stated ability.
    judgment: true
    feeds: []
    workflow_phase: servicing
    owner_role: loss_mitigation_specialist
    secondary_owner_role: ''
    cadence: per_loan
    consequence: ''
    tags:
      - round-b
      - regulator-direct
      - va
      - m26-4
      - ch05
      - special-forbearance
      - 38cfr-36.4301
      - promoted
    primary_source:
      tier: 1
      authority: VA Servicer Handbook M26-4 Chapter 5 — Loss Mitigation
      source_class: va-handbook-m26-4
      source_url: https://benefits.va.gov/WARMS/M26_4.asp
      snapshot_id: 2f7ddad872ea50b3
      fetched_at: '2026-05-23T01:50:00Z'
      content_hash: sha256:609536e8365c71a57c632f219b16799ce1b65cca131de510f2b51349ca9109d9
      paragraph_quote: c. Servicers must offer the Special Forbearance when the borrower indicates they can
      drafter_attestation: Copied verbatim from VA Handbook snapshot 2f7ddad872ea50b3 (M26-4 Ch. 5.03c — Special Forbearance duty to offer) at 2026-05-23. Source PDF retrieved via Wayback Machine.
    promoted_at: '2026-05-23T13:10:18+00:00'
    promoted_from: va-m26-4-ch05-roundb-v1.yaml
  - id: va-m26-4-ch05-discuss-and-offer-repayment-plan
    canonical_id: va-m26-4-ch05-discuss-and-offer-repayment-plan
    section: VA M26-4 Ch. 5.04, Subsection c — Repayment Plan Duty to Discuss and Offer
    description: |
      [SERVICER] must discuss and offer, if appropriate, the repayment
      plan when the borrower indicates they can repay the current loan
      payment plus additional amounts to bring the loan current, as
      outlined in the VA Home Retention Waterfall.
    type: do
    audit_question: For every VA-guaranteed loan in reportable default where the borrower indicates ability to pay current installments plus additional amounts to cure the delinquency, can [SERVICER] evidence that a repayment plan was discussed and (where appropriate) offered consistent with the VA Home Retention Waterfall?
    program_review: Does the loss-mit program account for the waterfall trigger — discuss and (where appropriate) offer a repayment plan when the borrower indicates ability to pay current installments plus additional amounts to cure, consistent with the VA Home Retention Waterfall?
    file_review: Start with the servicing notes to confirm the borrower's stated ability and that a repayment plan was discussed/offered per the waterfall. The officer judges the 'if appropriate' call.
    judgment: true
    feeds: []
    workflow_phase: servicing
    owner_role: loss_mitigation_specialist
    secondary_owner_role: ''
    cadence: per_loan
    consequence: ''
    tags:
      - round-b
      - regulator-direct
      - va
      - m26-4
      - ch05
      - repayment-plan
      - 38cfr-36.4301
      - promoted
    primary_source:
      tier: 1
      authority: VA Servicer Handbook M26-4 Chapter 5 — Loss Mitigation
      source_class: va-handbook-m26-4
      source_url: https://benefits.va.gov/WARMS/M26_4.asp
      snapshot_id: 2f7ddad872ea50b3
      fetched_at: '2026-05-23T01:50:00Z'
      content_hash: sha256:609536e8365c71a57c632f219b16799ce1b65cca131de510f2b51349ca9109d9
      paragraph_quote: c. Servicers must discuss and offer, if appropriate, the repayment plan when the
      drafter_attestation: Copied verbatim from VA Handbook snapshot 2f7ddad872ea50b3 (M26-4 Ch. 5.04c — Repayment plan duty) at 2026-05-23. Source PDF retrieved via Wayback Machine.
    promoted_at: '2026-05-23T13:10:18+00:00'
    promoted_from: va-m26-4-ch05-roundb-v1.yaml
  - id: va-m26-4-ch05-correct-mod-within-60-days
    canonical_id: va-m26-4-ch05-correct-mod-within-60-days
    section: VA M26-4 Ch. 5.05 — Loan Modification Corrections Within 60 Days
    description: |
      Where VA notifies [SERVICER] of a loan modification correction
      needed because terms negatively impact the Veteran or the
      Government, [SERVICER] must complete all corrections within 60
      days of notification by VA. Failure to make corrections within the
      required timeframe could result in VA adjusting the claim if the
      loan becomes delinquent and subsequently terminates.
    type: do
    audit_question: For every VA notification to [SERVICER] of a required loan-modification correction, can [SERVICER] evidence completion of the correction within 60 days of notification, with documentation of any borrower or Government remediation?
    program_review: Does the program track the 60-day correction clock — where VA notifies [SERVICER] that modification terms negatively impact the veteran or Government, complete all corrections within 60 days of notification?
    file_review: Spot-check VA modification-correction notifications; confirm corrections were completed within 60 days, with remediation documented.
    judgment: false
    feeds: []
    workflow_phase: servicing
    owner_role: loss_mitigation_specialist
    secondary_owner_role: compliance_officer
    cadence: per_event
    consequence: ''
    tags:
      - round-b
      - regulator-direct
      - va
      - m26-4
      - ch05
      - loan-mod-correction
      - 60-day-deadline
      - promoted
    primary_source:
      tier: 1
      authority: VA Servicer Handbook M26-4 Chapter 5 — Loss Mitigation
      source_class: va-handbook-m26-4
      source_url: https://benefits.va.gov/WARMS/M26_4.asp
      snapshot_id: 2f7ddad872ea50b3
      fetched_at: '2026-05-23T01:50:00Z'
      content_hash: sha256:609536e8365c71a57c632f219b16799ce1b65cca131de510f2b51349ca9109d9
      paragraph_quote: 'impact the Veteran, or the Government. Servicers must complete all corrections within 60 '
      drafter_attestation: Copied verbatim from VA Handbook snapshot 2f7ddad872ea50b3 (M26-4 Ch. 5.05 — Mod correction 60-day deadline) at 2026-05-23. Source PDF retrieved via Wayback Machine.
    promoted_at: '2026-05-23T13:10:18+00:00'
    promoted_from: va-m26-4-ch05-roundb-v1.yaml
_promotion_history:
  - promoted_at: '2026-05-23T13:10:18+00:00'
    candidate_path: obligations\_remediation\_round_b_drafts\va-m26-4-ch05-roundb-v1.yaml
    candidates_promoted: 3
    candidates_skipped_existing: 0

Verbatim regulatory text (3)

Verbatim provisions from VA Servicer Handbook M26-4 Chapter 5 — Loss Mitigation — each quote is a verified substring of the regulator-published source snapshot, not retyped. Quoted for reference; this is not legal advice. The operational layer (P&P updates, prompts) lives in the regulation update kits.

VA M26-4 Ch. 5.03, Subsection c — Special Forbearance Duty to Offer

c. Servicers must offer the Special Forbearance when the borrower indicates they can

Source: VA Servicer Handbook M26-4 Chapter 5 — Loss Mitigation · source URL · snapshot 2f7ddad872ea50b3

VA M26-4 Ch. 5.04, Subsection c — Repayment Plan Duty to Discuss and Offer

c. Servicers must discuss and offer, if appropriate, the repayment plan when the

Source: VA Servicer Handbook M26-4 Chapter 5 — Loss Mitigation · source URL · snapshot 2f7ddad872ea50b3

VA M26-4 Ch. 5.05 — Loan Modification Corrections Within 60 Days

impact the Veteran, or the Government. Servicers must complete all corrections within 60

Source: VA Servicer Handbook M26-4 Chapter 5 — Loss Mitigation · source URL · snapshot 2f7ddad872ea50b3