I got a very intriguing email from my Family Readiness Officer today. Looks like there is something in this almost $800,000,000,000 (yes that is billion) stimulus for military homeowners. Instead of trying to relate all that is in the proposed bill I will just paste the message below:
The Senate Proposes Military Homeowner Relief The “American Recovery and
Reinvestment Act” (S. 336), the economic stimulus bill offered by the Senate
Appropriations Committee this week, includes a provision that would provide
significant relief to military homeowners on PCS orders who are upside down
on their mortgages or otherwise suffer a significant loss on the sale of
their homes. It would also cover certain wounded warriors and their
survivors.The bill would temporarily extend coverage to these groups under the
Homeowners Assistance Program (HAP), which normally only applies to members
whose home values are depressed by base realignments and closures.The provision would cover service members and federal civilian employees in
these categories who purchased a primary residence before July 1, 2006 and
who receive PCS orders or suffered a wound, injury, or illness while
deployed between that date and September 30, 2012. The wounded, ill, or
injured member/employee would qualify only if the condition were
subsequently rated as at least 30% disabling by DoD or the VA and the member
was reassigned for medical treatment/rehabilitation or was medically
retired. In the event the member died of the injury or illness or was killed
in the line of duty while deployed, the survivor would receive the coverage.We asked the Appropriations Committee staff for the rationale for
establishing the July 1, 2006 cutoff date for home purchases. They indicated
the sense that the home market decline was underway at that point, and the
intent was to protect people who purchased homes before they had any warning
to expect a decline.Under the HAP, a person who sells a home at a loss upon relocation (based on
fair market values determined by the Secretary of Defense) can be reimbursed
for the lost fair market value, with the service member/employee absorbing a
“deductible” amounting to 5% of the pre-July 2006 value.If the person has difficulty selling the home, the Defense Department has
authority to purchase the home at a price not to exceed 90% of the pre-July2006 value.
The stimulus bill language specifies this would be a special program that
could be used only once, and only for a primary residence. A homeowner who
previously received any payment under HAP would be ineligible.The House version of the stimulus bill (H.R. 1), which passed the House on
Wednesday, does not contain a similar provision.The full Senate is expected to begin consideration of the stimulus bill next
week. Once the Senate approves it – which could take a week or more – House
and Senate leaders will need to reconcile this and other differences between
their respective bills.MOAA strongly supports the Senate provision. Once the full Senate approves
the bill – hopefully next week — we will generate an alert urging House and
Senate leaders to retain this provision in the final stimulus bill.
Just to clarify that this was passed in the Senate only and I am not sure if it will make it into the final bill. I hope it does as it will relieve those that bought a house and cannot continue to live in it due to the fact that they are being forced to move across the country.
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March 16th, 2009 at 11:17 am
I’m curious what you (and others) think about this. I’m delighted to give some relief to military families who have been truly impacted by base closures and other extraordinary situations, but I do wonder about providing relief to homeowners who purchased with the intent to flip the house for a profit a few years later. For those buyers, it was a gamble. The government wouldn’t have shared in their winnings if the gamble had paid off, so why should the government cover their losses? Anytime a military member chooses to purchase a home, they know that they may be transferred and that the sales value of the house could go up, or it could go down.
My isn’t intended to be against this benefit, rather, to see what other people think.