VALOR Act

Summary of HR 7598 ( VALOR Act)

Purpose and intent

• The bill is titled the Veterans Assistance for Loan Origination Relief Act (VALOR Act).
• Its primary aim is to provide financial relief to certain veterans by refunding housing loan origination fees paid to the Department of Veterans Affairs (VA) when those fees are assessed in connection with pending disability claims.

Key provisions and changes

• Amends title 38 of the United States Code, specifically Section 3729, to address overpayments and refunds related to housing loan fees.
• New subsection (c)(3): Establishes that any fee collected in violation of existing rules (i.e., fee collection in a manner contrary to subsection (a)) is treated as an overpayment. The Secretary of Veterans Affairs would:
  • Refund the affected individual the amount of the fee, or
  • If the fee was paid as part of a loan, credit the fee amount toward the loan.
• New subsection (d): Special provision for veterans with pending disability claims at the time they apply for a VA housing loan guaranteed, insured, or made under this chapter:
  • A fee can be collected from such veterans under subsection (a).
  • If the veteran’s disability compensation claim is later approved and compensation is awarded, and the veteran receives disability compensation after paying the fee, the Secretary must reimburse the veteran the amount of the fee.

Who is affected

• Veterans applying for VA housing loans (guaranteed, insured, or issued under the relevant VA loan program) who have pending disability claims at the time of loan application.
• Veterans who subsequently receive disability compensation after paying a housing loan origination fee due to the pending claim must be reimbursed by the VA for that fee.

Procedural and timeline aspects

• The bill introduces a mechanism for refunds/rebates of housing loan origination fees:
  • If a fee is wrongfully collected, it must be refunded or credited toward the loan.
  • If a veteran’s disability claim is approved after paying the fee, the VA must reimburse the fee amount.
• Effective dates are not specified in the text provided; the bill lays out how refunds and reimbursements should be handled once it becomes law, including the handling of overpayments and pending disability claims at loan application.
• Legislative action history:
  • Introduced February 17, 2026, by Rep. Levin (co-sponsored by Moylan, Correa, and Levin).
  • Referred to the House Committee on Veterans' Affairs and subsequently to the Subcommittee on Economic Opportunity (as of March 10, 2026).

Potential impact

• Financial relief for veterans who are navigating housing loans while their disability claims are pending.
• Clarifies and formalizes refund/reimbursement pathways for VA loan origination fees, potentially reducing out-of-pocket costs for affected veterans.
• Could influence VA loan processing practices to ensure compliance with the new refund/credit requirements.