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Planet Money

The veteran loan calamity

01 Nov 2024

Transcription

What is the veteran loan calamity?

718.634 - 727.241 Ray Queen

The way we were explained it is, It would be a fairly simple process. You start making payments again and you're done.

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727.902 - 748.911 Chris Arnold

And to be clear, this is a very normal way to restart payments after forbearance. And the vast majority of homeowners who had trouble during COVID were able to resume making their mortgage payments in some affordable way. But a lot of military veterans with VA loans were not able to do that.

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749.676 - 761.913 Chris Arnold

When the Queen's forbearance period was up, when they got their repayment options, that simple, affordable version of forbearance where you just move the missed payments to the back of the loan, it was nowhere to be found.

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762.737 - 781.749 Quill Lawrence

So they were told they could pay back all of their missed payments all at once, $22,000, which they didn't have, or they could do what's called a loan modification, but rates had gone way up. I mean, mortgage rates had doubled, and that meant if they did a loan mod, their payments were gonna go up by a huge amount.

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782.389 - 793.395 Unnamed Reporter

They couldn't afford any of those options. And after arguing on the phone for months with their mortgage company, saying this wasn't supposed to be the deal, they eventually realized they're going to be facing foreclosure.

794.116 - 816.085

And when I tell you that my heart dropped and, like, my hands were shaking and, honest to God, I... It was scary. I was at work and I ended up leaving and telling Ray that, you know, I needed to talk to him before the kids got home from school because that was not something that the kids needed to hear.

816.638 - 831.509 Quill Lawrence

I mean, when I talked to Ray and Becky Queen, they were very close to foreclosure. I mean, you start getting letters in the mail that say, like, we're going to foreclose on your house. You know, there's not much time left. And they were scared and angry and confused.

831.949 - 856.764 Ray Queen

And now we're at the point where we've got to figure out what, you know, do we just do we give up and give in? Do we give up our property and and walk away? And this is supposed to be a program that you're that y'all. So what was happening?

856.824 - 876.702 Chris Arnold

The clock was ticking on the Queen's home. Chris starts calling, like, everyone, trying to get an answer to what exactly is going on here. I can't remember exactly. One thing led to another, and I finally found a guy. We'll call this person a well-positioned source. And Chris wound up talking to a bunch of people to confirm everything. But yes, he found a guy.

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