Money, VA debt and scams: protect what you've earned

Got a VA debt letter? Take a breath. You have options

VA debt usually comes from an overpayment: VA paid you, or your school, more than you were due. Common causes are a life change that wasn't reported in time (a marriage or divorce, higher income, a child leaving school, a jail sentence) or a VA error such as a double payment.

Read the first letter closely and note its date. Two deadlines start from it.

• Think the debt is wrong? Dispute it within 30 days of the first letter. A dispute filed on time pauses collection while VA looks again.
• Can't pay, or think it's unfair to make you pay? Ask VA to forgive it (a waiver). You now have 1 year from the first letter. VA changed this from 180 days.
• Other options: a payment plan, a compromise (VA accepts a smaller amount as payment in full), or a hardship pause on repayment.
• A waiver, a compromise, or a plan of 5 years or longer needs VA Form 5655, the Financial Status Report. It's online.
• If a debt goes unpaid, VA can hold back your monthly benefits, report it to credit bureaus and add interest. After 120 days it goes to the U.S. Treasury. If Treasury or a collection agency already has it, don't pay VA directly; call the Debt Management Center first.

• VA Debt Management Center (benefit debt)

  Mon to Fri, 7:30 a.m. to 7 p.m. Eastern. From overseas: +1-612-713-6415.

  800-827-0648

• VA Health Resource Center (copay bills)

  Mon to Fri, 8 a.m. to 8 p.m. Eastern.

  866-400-1238

Sources: VA.gov: Manage your VA debt; VA.gov: Options to request help with VA debt; VA.gov: VA debt management

VA health care copay bills

Copay bills follow their own clock. After 30 days, interest and a monthly fee are added. After 90 days, VA may hold back benefits or report to credit bureaus. After 120 days, VA must send the debt to the Treasury and can no longer help you with it, so call early.

If your income dropped, ask about a hardship determination or a copay exemption. You can also ask for a repayment plan (VA Form 10-323), or a waiver or compromise (VA Form 5655).

Source: VA.gov: Pay your VA copay bill

Avoid the next overpayment

Tell VA right away when your family or money changes: marriage, divorce, a death, a child leaving school, more income, or going to jail. On the GI Bill, check in with your school certifying official every term and report a dropped class right away.

The sooner VA knows, the smaller any overpayment will be.

Source: VA.gov: VA debt management

Free money coaching

You don't have to figure out a budget or a debt plan alone.

• Veterans Benefits Banking Program: VA's partner program offers free counseling from an accredited financial professional to any Veteran, survivor, caregiver or family member who gets VA benefits.
• Military OneSource: free, confidential financial counseling for honorably discharged service members, retirees and their immediate families, up to 365 days after leaving the military. Call 800-342-9647, any time.
• National Foundation for Credit Counseling (NFCC): a nonprofit network of certified credit counselors for budgets, debt and housing. Ask about any fee before you start.

Sources: VA: Veterans Benefits Banking Program; Military OneSource: Eligibility

If VA appoints a fiduciary

A fiduciary is a person VA picks to manage the VA benefits of someone who can't manage money because of injury, illness or age. VA only does this after medical evidence or a court says the person can't handle their finances, and the fiduciary has to pass a background check.

You have rights. You can suggest someone you trust. You can ask for a review of the decision within 1 year of the letter. You can write to VA with medical evidence and ask to manage your own money again. A paid fiduciary can take no more than 4% of the monthly benefit, and a spouse or relative can't charge a fee.

• VA Fiduciary Program

  888-407-0144

Sources: VA: Fiduciary Program; VA.gov: Fiduciary help

Think you were scammed? Report it, and get support

It's not your fault, and reporting it can stop it from happening to the next Veteran. If you shared a bank or VA.gov login, change your passwords and call your bank first.

• AARP Fraud Watch Network Helpline

  Free trained fraud specialists, Mon to Fri, 8 a.m. to 8 p.m. Eastern. You don't have to be an AARP member.

  877-908-3360

• VA benefits scams (VSAFE)

  Report a scam that targets your VA benefits.

  833-388-7233

• VA Inspector General hotline

  Fraud, waste or abuse involving VA. Mon, Tue, Wed and Fri 9:30 a.m. to 3:30 p.m., Thu 9:30 a.m. to 1 p.m. Eastern.

  800-488-8244

Sources: FTC: ReportFraud.ftc.gov; VA OIG: Hotline; VA: Fraud prevention (VSAFE); AARP: Fraud Watch Network Helpline