The Department of Veterans Affairs on February 16 announced that it has partnered with the Department of Justice and the attorneys general of 49 states in a $25 billion settlement with five of the nation's biggest private mortgage lenders.

In addition to principal reductions for non-veterans and fines paid to federal and state government agencies, the settlement bolsters a lesser known veterans benefit. A provision under the Servicemembers Civil Relief Act helps servicemen and women who are forced to sell their homes at a loss due to redeployment. Some money from the $25 billion settlement will go to enhance protections under that act, VA said.

“VA will continue its oversight of lenders and servicers to ensure that veterans and servicemembers are able to enjoy the benefits of VA’s home loan program, including access to no-downpayment loans and assistance in retaining their homes should they encounter payment difficulties,” according to Allison Hickey, VA Under Secretary for Benefits.

More than 357,000 VA home loans were issued during 2011, and there are more than 1.5 million active VA home loans nationwide, according to recent statistics from that agency.

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