c. Transfer of Loans

It is not necessary to notify VA of the assignment of a guaranteed loan.

d. Loan Assumptions

The assumption of VA-guaranteed loans for which commitments were made on or after March 1, 1988, requires the approval of VA (or certain lenders on VA’s behalf). 

Note:  See sections 13 and 14 of chapter 1of VA Handbook H26-94-1, The VA Servicing Guide (www.homeloans.va.gov/service.htm), for details on authorities and procedures for processing assumptions.

e. Paid-in-full Loans

Lenders are required to report paid-in-full loans to VA upon full satisfaction of the loan by payment or otherwise. 

Procedures

·   Mark the Loan Guaranty Certificate (LGC) “PAID IN FULL”

·   have an authorized officer of the holder date and sign the LGC, then

·   return the LGC to VA.

If VA has endorsed the note as evidence of guaranty, cancel the endorsement and send notification to VA.

If the LGC has been lost or inadvertently destroyed, send notification to VA of full satisfaction of the loan and the disposition of the LGC.