We salute our service men and women for doing an incredible job keeping us safe.
However, while they are out there doing their duty the last thing anyone would want is their judgement clouded by the worry of a
short sale.
Members of the military who find themselves in a short-sale situation now have a new tool via the Homeowners Assistance Program (HAP) through the Department of Defense (DoD).
Recently thanks to the American Recovery and Reinvestment Act of 2009, Congress expanded the
Homeowners Assistance Program so that now neaerly every military personnel involved in a short sale so that they can obtain financial help from the program is they are upside down in their loan to value when they must sell due to a mandatory permanent transfer.
Authorized under Section 1013 of the Demonstration Cities and Metropolitan Development Act of 1966, HAP is a law that is managed by the U.S. Army Corps of Engineers "to assist eligible homeowners who face financial loss when selling their primary residence homes in areas where real estate values have declined because of a base closure or realignment announcement." -
The American Recovery and Reinvestment Act expands the legislation temporarily for DoD employees due to the finance market driven recession.
Those who can apply for assistance include:
- service members and DOD employees who are wounded, injured or become ill when deployed;
- surviving spouses of service members or DOD employees killed or died of wounds while deployed;
- service members and civilian employees assigned to BRAC 05 organizations; and
- service members required to permanently relocate during the home mortgage crisis.
The assistance is limited to employees who were reassigned within about a 5-and-a-half year period between 2006 and 2012 and the house being considered must have been the applicant's primary residence. Some of the criteria for eligibility include:
- Permanent reassignment requires move of more than 50 miles.
- Reassignment ordered between 1 February 2006 and 30 September 2012.
- Property purchased (or contract to purchase signed) before 1 July 2006.
- Property was the primary residence of the owner
- Owner has not previously received these benefit payments.
Now, how about if you are on the other end of a transaction where you are the buyer of a house where the HAP program has been used?
Well, here is how it works - the use of the program requires the assignment of the contract to the Department of Defense, via the U.S. Army Corps of Engineers. In short, the seller conveys the house over to the USACE and then the purchaser buys the house from the USACE all at the same time at the same closing table.
So this means that for military personnel in Ann Arbor and the rest of the nation there is help if you are in a
short sale situation.
More information on HAP can be viewed here.
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