---
kind: "section"
citation: "38 U.S.C. § 2053"
title: "38"
title_heading: "Veterans’ Benefits"
number: "2053"
heading: "Default"
release: "119-102"
date: "2026-07-12"
url: "https://uscodex.org/usc/38/2053"
units:
  - "Part II — General Benefits"
  - "Chapter 20 — Benefits for Homeless Veterans"
  - "Subchapter VI — Loan Guarantee for Multifamily Transitional Housing"
---

# §2053. Default

- (a) The [Secretary](/usc/38/101.md?p=1) shall take such steps as may be necessary to obtain repayment on any loan that is in default and that is guaranteed under this subchapter.
- (b) Upon default of a loan guaranteed under this subchapter and terminated pursuant to [State](/usc/38/101.md?p=20) law, a lender may file a claim under the guarantee for an amount not to exceed the lesser of—
  - (1) the maximum guarantee; or
  - (2) the difference between—
    - (A) the total outstanding obligation on the loan, including principal, interest, and expenses authorized by the loan documents, through the date of the public sale (as authorized under such documents and [State](/usc/38/101.md?p=20) law); and
    - (B) the amount realized at such sale.

## Source credit

(Added Pub. L. 105–368, title VI, § 601(a), Nov. 11, 1998, 112 Stat. 3344, § 3774; renumbered § 2053, Pub. L. 107–95, § 5(d)(1), Dec. 21, 2001, 115 Stat. 918.)

## Notes

### Editorial Notes

### Amendments

2001—Pub. L. 107–95 renumbered section 3774 of this title as this section.

### Statutory Notes and Related Subsidiaries

### Effective Date

Section effective Oct. 1, 1998, see section 602(f) of Pub. L. 105–368, set out as an Effective Date of 1998 Amendment note under section 2106 of this title.