A servicer advance requires no monthly payment, so it never appears on what they read each month. It appears at closing, out of the proceeds you already promised.
The VA opened its partial claim program on June 15, 2026, and Pennymac was the first big servicer to use it. Every other VA servicer has until November 28. Here is the part that lands on you. When a servicer advances money to bring a late loan current, that amount becomes a second balance sitting behind the first mortgage. It requires no monthly payment, so it never appears on the statement your seller reads. It comes due when the home is sold — out of their proceeds, at closing, after you have already built the net sheet.
“An existing partial claim can also affect a later transaction because the deferred balance must be accounted for at payoff.”
This is a net-sheet trap with a real dollar cost, and the design of the program is what hides it. A partial claim balance sits behind the first mortgage and requires no monthly payment. So it does not appear on the seller's monthly statement, and it is not in the seller's head. They tell you what they owe, you build the net sheet off that number, and the deferred balance surfaces at closing out of the money that was supposed to be their proceeds. On a thin-equity sale that is the difference between a closing and a short sale. The cap tells you the size of the risk: up to 25% of the unpaid principal balance, and up to 30% for certain borrowers who missed a payment during the 2020-to-2025 window. The actual deferred amount is whatever arrears the servicer advanced, not the cap — but the cap is why this can be a five-figure surprise rather than a rounding error. The fix takes one call and it is procedural. Pull a current payoff statement, not the last mortgage statement, before you price and before you present a net sheet. Do it on any seller who was ever delinquent, took forbearance, or has a government-backed loan. And the volume of these is about to rise, not fall, because most servicers have not implemented the program yet. **What we're assuming:** the article does not say how many sellers are carrying a partial claim balance. It gives you the mechanism and the deadline; the frequency is a judgment call, and in a market with heavy VA financing it is worth building into the routine rather than saving for special cases.