What is open for business during a federal government shutdown?
Operations for the Internal Revenue Service and National Park Service are shuttered. The U.S. Coast Guard goes without pay, and the U.S. Department of Homeland Security is also unfunded.
But what about the U.S. Department of Veterans Affairs (VA)?
The VA has issued statements in the past during government shutdowns to remind those relying on VA care and services that the agency is still open for business. Statements have included that there are VA services designed to give “furloughed veteran federal employees affected with much-needed support and relief.”
How the VA Helps Veterans During a Government Shutdown
VA benefits remain available during a government shutdown, but peak processing times for certain benefits can coincide with federal budget troubles in Washington, D.C. In addition, other benefits may be directly affected by a furloughed veteran’s ability to make payments on VA home loans, etc.
There are areas where VA resources can be used to offset hardships brought on by furloughs and suspension of pay.
VA Compensation and Pensions Continue to Be Paid During a Government Shutdown
Disabled veterans, dependents and survivors would continue to receive their payments from VA.
Working Overtime to Process and Pay VA Education Benefits
The VA acknowledges that January and February are high-demand months for the GI Bill and other VA education benefits.
This can coincide with government shutdowns. For instance, the last federal government shutdown was the longest in U.S. history, lasting 35 days from Dec. 22, 2018, to Jan. 25, 2019, during the Trump administration. During that shutdown, the VA said it had “over 1,100 employees processing GI Bill benefits.”
Anyone experiencing financial hardships during a furlough, experiencing delayed GI Bill payments or needing other GI Bill-related assistance can call 1-888-442-4551 for advice and help.
Benefit Overpayments, Debt Relief and Financial Assistance
Veterans who are paying back overpayments of veterans’ benefits and need temporary financial relief during a furlough period or at other times should contact VA’s Debt Management Center at 1-800-827-0648.
The center may be authorized to suspend collection activity on your account, but this is not automatic and must be requested.
Why Federal Employees Furloughed or Working Without Pay Can’t Just Get Part-Time Jobs
It is not always possible for federal employees to find and work part-time jobs during shutdowns.
During the Jan. 2018 shutdown, which lasted three days (Jan. 20-22, 2018), the VA pointed out that:
“Even while on furlough, an individual is an employee of the Federal government. Therefore, the Executive Branch-wide standards of ethical conduct . . . which include rules on outside employment, continue to apply to employees on furloughs. Additionally, there are statutes which prohibit certain outside activities.”
It’s clear that the simplest solution for getting through difficult circumstances during furloughs isn’t as easy as locating another source of income.
VA Community Care
VA assistance is available for veterans who struggle to make required co-pays for health care and other issues, and this help remains available regardless of government shutdowns or other circumstances.
A veteran should contact the VA any time there is a job loss, decrease in income or an increase in health care expenses that must be covered out-of-pocket.
Ask the VA to make a determination about qualifying for financial hardship assistance, which can take the form of a repayment plan, a co-payment exemption or a debt waiver.
Did you know you have the right to establish a monthly repayment plan at any time during your enrollment in VA health care if you can’t pay the debt off right away? The VA says typical payment plans are no longer than 36 months, but the size of the debt and ability to pay are determining factors in consideration for any payment plan.
VA Home Loans Are Still Available During the Government Shutdown
The VA urges participating lenders to be more flexible when working with VA Home Loans borrowers and loan applicants who have lost income after natural disasters and times of crisis.
A federal budget crisis is no exception. In the past, the VA has encouraged lenders to waive late fees, forgive late payments and avoid negative credit reporting.
New VA mortgage loans are possible, even if an applicant is furloughed. Learn more about VA Home Loans and how they are handled during a shutdown or other difficult times by calling 1-877-827-3702.
It is important VA Home Loans borrowers, as well as those with other government-backed home loans like – FHA or USDA loans – contact their lenders as soon as financial difficulties are known.
The longer homeowners wait, and the more payments missed, the fewer options they have to avoid loan default and foreclosure.
Contact participating VA Home Loans lenders as soon as possible, and seek other assistance while dealing with a loss of income because of a furlough or another period of financial hardship.
Veteran Readiness and Employment (VR&E) Still Operates During Government Shutdowns
Applicants with services from Veteran Readiness and Employment (VR&E), formerly known as Vocational Rehabilitation and Employment, should meet with their counselors. The usual eligibility determinations are made for services and career planning. These benefits are not limited to those currently working with a VR&E counselor; the VA encourages new applications, even when furloughs are in place.
VA Insurance is Still Available During the Government Shutdown
The Office of Servicemembers’ Group Life Insurance does not stop issuing new policies. It still collects premiums, services insurance policies and pays out claims.
VA Home Loans, VA Co-pays and Other Expenses are Still Due
Medical co-pays, VA mortgage payments, GI Bill overpayment issues or other indebtedness are still due during shutdowns or other periods of financial hardship, unless a veteran or family specifically requests other arrangements.
No financial relief offered on VA loans, medical care co-pays or other expenses is automatic. Borrowers must make arrangements with their creditors to get the help they need, including during a federal budget impasse.
Some types of financial relief are dependent on borrowers contacting creditors before they miss payments on their accounts. Others may depend on how long it has been since a missed payment before requesting assistance.
Options are more limited if you are more than one payment behind on monthly debts, than if you contact your creditor ahead of any late or missed monthly bill payments.
Weigh Your Options Carefully
If you’re affected by suspended pay or furloughs, you may be tempted to start putting your living expenses on credit cards or take out personal loans to avoid running up credit card debts.
The important issue here is the long-term cost of your short-term money crisis management approach. A personal loan and a credit card have different interest rates, terms and conditions. Determine which makes the most financial sense and costs less when it’s all said and done.
If you take out a personal loan with an interest rate lower than a credit card’s and pay the loan back as soon as is feasible, you may save more money in the long run by not paying long-term interest rates on credit card cash advances or other similar measures. Do the math before settling on a course of action, and see how much options cost over time.
VA Advice to Those Struggling Financially During a Government Shutdown
The Department of Veterans Affairs urges veterans and family members to continue using VA services and treatment while any federal budget crisis is being addressed.
There are other steps the VA suggests struggling veterans and families take, including reaching out to credit unions and military-friendly banks to see what stopgap measures might be available, avoid loan defaults and limit damages to long-term financial plans while addressing short-term needs.
During the federal government shutdown in January 2019, the VA compiled this detailed list and points of contact for assistance.
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