VA Industry Day Presentation Loan Servicing.pdf

VA Loan Servicing Requirement Information Session

• Loan Guaranty Service

• Veterans Benefits Administration

• Industry Day

• August 12, 2026

Agenda VA Loan Servicing Program

* Loan Servicing Background

* Program Objectives

* Scope of Work

* Vendee Origination

* Loan Accounting and Invoicing

• Questions

Loan Servicing Background

• The Department of Veterans Affairs (VA) Loan Guaranty

Service (LGY) administers a home loan program that promotes home ownership among our nation’s Veterans and active-duty personnel. Currently the VA has a combined contract. The VA is splitting this contract into two separate parts the Real Estate Owned which includes property disposition and the Loan Servicing which includes vendee origination.

• VA Central Office (VACO) Loan and Property Management administers the contract. The Portfolio Loans Oversite Unit (PLOU) conducts contract oversight and daily operations for Portfolio loans.

• PLOU has decision-making authority for approving proposed settlements, property preservation expenses that exceed published guidelines ,terminations without foreclosure, specific loss mitigation recommendations (e.g., modifications), or activities outside the Contractor’s scope of authority.

Program Objectives

• VA requires that the Contractor make prudent and appropriate business decisions that serve the interests of the VA and adhere to the constraints of this procurement and all appropriate laws and regulations. The primary objectives are:

• Promote servicing practices that support VA’s mission of helping borrowers retain their homes or avoid foreclosure and provide excellent customer service.

• Improve reporting, information management and security; and

• Ensure accountability and fiscal responsibility for all activities and protect the interests of the Secretary of Veterans Affairs (the Secretary).

Vendee Origination

The Service Provider must originate and underwrite Vendee Loans. Vendee financing is a Department of Veterans Affairs (VA) direct loan program that is available to purchase VA Real Estate Owned Properties (REO). Vendee financing is offered to both Veteran and non-Veterans. VA funds these loans and boards them into VA’s National Loan Portfolio. These loans are then, at the sole discretion of VA, packaged by the Contractor and included in Loan Sales as described in Section 5.6.8 or held in the VA loan portfolio.

* Currently the VA does not conduct whole loan sales.

Loan Accounting and Invoicing

• The Government is seeking a streamlined, electronic process that allows ease of use and minimal administration for the COR/Authorized Designee to receive and approve invoices. The Contractor at a minimum shall:

• Advance payments for taxes (including penalty and interest) and other reimbursable expenses.

• Submit all invoices for final disposition in a VA- approved electronic format.

• Ensure that all invoices are substantiated by complete imaged or electronic documentation in support of allowable expenses and fees, including that which are performed by Contractor or Subcontractors for services that are not included in the flat-fee structure Section B of this solicitation. Documentation shall be made available as invoices are received by the Contractor from Subcontractors.

The VA commonly refers to loans by loan type

• 0. Partial Claims – Created when VA purchases missed mortgage payments that the Veteran-borrower was unable to make during the national COVID-19 pandemic.

• 1. Direct Loans – Typically created when VA issues loans directly to Veterans on Native American Trust Land under the Native American Direct Loans (NADL) Program. This loan type also includes a small number of direct loans funded by VA under the Specially Adapted Housing Program, and a declining number of older direct loans funded by VA under the G.I.

Direct Home Loan program prior to the nationwide availability of private lender funding.

• 2.Installment Contracts – Installment Contract is a form of seller financing in which the buyer agreed to purchase real property by making a series of installment payments to the seller over time. Title remained with the VA until the purchaser made all required payments under the contract.

• 3. 4600 Repurchased Loans / Vendee Loans – Created when VA repurchases a Vendee loan previously sold to a private lender under the terms of 38 Code of Federal Regulations (CFR) 4600.

Loan Types continued

• 4. Refunded Loans – Created when VA purchases a guaranteed loan from a private lender to help a Veteran avoid foreclosure and the loss of his/her home.

• 5. Vendee Loans – Created under the same circumstances as Loan Types 3 and 4.

• 6. Refunded Loans – Created under the same circumstances as Loan Type 5.

• 7. VASP Loans – Loans that were purchased specifically under the VASP (Veterans Assistance and Services Program), like a type 5 or 8 loan.

VA Portfolio as of 07/31/2026

NADL, 554

Partial Claims, 38,434

Refunded, 41 Repurchase, 877

VASP, 31,106

VENDEE, 1,071

Units

NADL Partial Claim Refunded Repurchase VASP VENDEE

Scope of Work

• The Contractor shall provide all resources necessary to accomplish the requirements described in this PWS. Specifically, the Contractor shall provide and manage Portfolio Loan Servicing Contract (PLSC) for VA. The services shall include loan servicing and loan sale activities. The Contractor shall continuously update and enhance information made available to the VA, technology and the performance of their overall service delivery, in a manner consistent with industry standards as defined by VA.

Questions Offshore customer service and or servicing is prohibited.

For a more complete view of requirements, refer to the PWS.