If you have a GI loan and are unable to pay for the home, can they hold money out of your social security?
If you have a GI loan and are unable to pay for the home and have to default on it can they hold money out of your social security disability check if the home doesn't sell for as much as the loan is?
No, they cannot take your disability benefits from you. Only the US Government can if you owe child support, taxes, student loans etc. When your loan goes into default, your servicer/holder is responsible for contacting you, the mortgagor, to determine the reason for the default and attempt to make arrangements to cure the delinquency. If the problem cannot be resolved by the time you are three payments past due, the servicer/holder is required to notify U.S. Department of Veterans Affairs that your loan is in default. After this notice is received, VA will attempt to contact you to discuss your current situation and help you determine the best course of action.
If your property cannot be sold for an amount which is greater than or equal to what you owe on the loan, VA may pay a "compromise claim" for the difference in order to help you go through with the sale. You must contact VA to discuss the situation and get prior approval for a sale with a compromise claim payment. The VA provides some information about the options to avoid a foreclosure.
For more information on foreclosures, please visit the foreclosure information page on Bills.com.
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Dealing with debt
If you are struggling with debt, you are not alone. According to the NY Federal Reserve total household debt as of Quarter Q4 2023 was $17.503 trillion. Student loan debt was $1.601 trillion and credit card debt was $1.129 trillion.
According to data gathered by Urban.org from a sample of credit reports, about 26% of people in the US have some kind of debt in collections. The median debt in collections is $1,739. Student loans and auto loans are common types of debt. Of people holding student debt, approximately 8% had student loans in collections. The national Auto/Retail debt delinquency rate was 4%.
The amount of debt and debt in collections vary by state. For example, in Virginia, 25% have any kind of debt in collections and the median debt in collections is $1647. Medical debt is common and 14% have that in collections. The median medical debt in collections is $690.
While many households can comfortably pay off their debt, it is clear that many people are struggling with debt. Make sure that you analyze your situation and find the best debt payoff solutions to match your situation.