The last several years have been difficult on all Americans economically, particularly veterans. To have VA entitlement is to have is to have financial backing from the government, which pledges to repay that mortgage in the case of default.
Remember that getting released for liability from a VA loan or having a debt waived by the VA is not the same as paying off the loan. In that case you'll have to pay back the government's loss. Once that is done and only then will your benefits be restored.
As a veteran you are able to apply for a new home loan utilizing your VA benefits once that home has been sold and the loan paid in full. There are no rules concerning the disposition of the first property once the loan has been paid in full. Some veterans may go to obtain a new loan for a second home and will have no entitlement remaining on their Certificate Of Eligibility or COE, we talked about it here. "Paid in full, no restoration" means the loan was paid off but the VA lacks information as to how the property was disposed.
Not to worry, if you're clients are faced with this simply have them update their Certificate Of Eligibility with the VA by filling out a VA form 26-1880. This is a process only the veteran can apply for in order to keep the lending process moving forward, this may delay your Close Of Escrow, so keep that in mind.