GI Jane Finances

February 5, 2009

Xmas may come early

Filed under: Uncategorized — gijanefinances @ 1:34 pm

This bill may give me my $10K back…

Bill may help troops in housing market crunch

By Karen Jowers – Staff writer
Posted : Monday Feb 2, 2009 6:52:59 EST

With the permanent change-of-station high season around the corner, hope may be on the horizon for military homeowners sweating at the thought of trying to sell their homes – as well as those who have already taken financial hits in the dismal nationwide housing market.

A provision in the Senate Appropriations Committee version of the economic stimulus package would add about $411 million to help military homeowners caught in the housing market crisis, including wounded warriors, surviving spouses, those affected by base realignments and closures, and those forced to move on PCS orders.

Officials with the Army Corps of Engineers, the Defense Department’s executive agency for the Housing Assistance Program, are preparing to help homeowners in the expectation that the provision will become part of the final stimulus bill.

In essence, the provision would expand the current Homeowners Assistance Program beyond its current mission of helping military and civilian homeowners relocating because of a base closure or realignment.

Corps of Engineers officials expect that more than 25,000 additional people would be eligible to file claims in the next few years if the new retroactive provision becomes law.

Officials are advising service members who might be eligible to gather necessary documents so they’ll be ready to file a claim if the process is set in motion.

“If we do get a law change, we will give last-minute instructions on what else they need,” said Don Chapman, Corps of Engineers assistant program manager for the Homeowners Assistance Program.

Among other things, homeowners will need a copy of their deed and a utility bill to prove that the home was their primary residence. He said homeowners can apply now, and the Corps will hold onto the application. Service members can visit hap.usace.army.mil <http://hap.usace.army.mil/>  to get more information and download the application packet.

Generally, the provision would allow defense officials to buy the home, pay off the mortgage or reimburse the service member for certain losses incurred during the sale or as a result of foreclosure against the homeowner.

The full Senate is expected to consider the bill the week of Feb. 2. If it is passed by the Senate, the assistance for military homeowners is one of the issues that will be discussed as lawmakers reconcile differences in the House and Senate versions of the bill. Lawmakers plan to have the bill finished by Feb. 16.

If it makes its way into law, the homeowner assistance provision would apply
to:

* Service members and Defense Department and Coast Guard civilians injured, wounded or ill in the line of duty during a deployment, with at least a 30 percent disability rating determined by defense or Veterans Affairs officials, who have relocated or will relocate for medical treatment or due to medical retirement.

* Surviving spouses of service members and Defense Department and Coast Guard civilians killed in the line of duty during a deployment, or who died from an injury or illness incurred in the line of duty during a deployment.
Survivors must relocate within two years of the death to qualify.

* Service members under PCS orders to a duty station outside a 50-mile radius of their current station. The primary residence must have been purchased by the owner before July 1, 2006, and sold between July 1, 2006, and Sept. 30, 2012. The reassignment must have been ordered between Feb. 1, 2006, and Sept. 30, 2012. Defense officials can designate earlier end dates.

* Service members and civilians who must sell their homes to relocate because of 2005 Base Closure and Realignment Commission actions during the current housing market crisis, without tying the decline in home values to BRAC. Under current law, the Homeowners Assistance Program assists BRAC homeowners only when it can be shown that declining market value in an area is a direct result of a BRAC-related action.

“Because of the nationwide collapse of the real estate market, it is difficult for a service member to demonstrate that a decline in home value is solely the result of a BRAC action,” the Senate Appropriations Committee stated in its report accompanying the bill. “In addition, service members who receive orders to move, wounded warriors, and surviving spouses may also be confronted with the need to sell their homes quickly, and face the prospect of selling at a loss or being forced into foreclosure.”

Corps of Engineers officials are drafting a preliminary rewrite of regulations, preparing to update their Web site, and looking at how they will get the manpower to carry out the new provision.

“We want to be ready to move quickly,” Chapman said.

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