Homeowners Assistance Program Helps Military Members Who Lost Money Due to PCS
The 2009 American Economic Recovery Act, also commonly referred to as the economic stimulus package, contains an assistance package to help US military who lost money on their home during a PCS move. The current economic crisis has affected housing prices around the nation, and the government wants to assist military members who were required to make a Permanent Change of Station (PCS) due to military needs.
Department of Defense Homeowners Assistance Program
The Department of Defense Homeowners Assistance Program (HAP) is managed by the US Army Corps of Engineers (USACE), and is only open to military members who were permanently reassigned because of a Base Realignment and Closure (BRAC) during the mortgage crisis. The following information is from the website:
The Department of Defense (DOD) is proud to offer the Homeowners Assistance Program (HAP) to eligible service members and federal civilian, including non-appropriated fund, employees. The program is authorized by law, and administered by the US Army Corps of Engineers (USACE) 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.
There are two main eligibility criteria:
- There has to be an announcement of a base closing or realignment action which affects your community.
- A determination must be made that real estate values have dropped as a direct result of the base closing or realignment announcement.
Once those criteria are met, there are additional requirements.
Department of Defense Homeowners Assistance Program eligibility requirements:
Update: The Homeowners Assistance Program has recently been modified to include wounded service members, surviving spouses of military members who die while deployed, and certain other military service members who are required to move more than 50 miles because they receive permanent change-of-station orders.
Homeowners Assistance Program eligibility requirements:
- PCS orders require relocation of more than 50 miles.
- Reassignment ordered between 1 February 2006 and 30 September 2012 (or earlier date designated by Secretary of Defense).
- Property purchased or contract to purchase signed before 1 July 2006.
- Property sold by owner between 1 July 2006 and 30 September 2012 (or earlier date designated by Secretary of Defense).
- Property was the owner’s primary residence.
- Owner has not previously received these benefit payments.
Other eligible personnel:
- Personnel transferred or terminated within six months prior to the announcement who were owner-occupants at the time of transfer.
- Civilian and military personnel on overseas tours who transferred within three years prior to the announcement and who are homeowners in the area.
How to file a Department of Defense Homeowners Assistance Program claim
If you are a military member who is PCSing or has PCSed during the window of eligibility, you will need to download the application packet and complete the application, DD Form 1607, Application for Homeowners Assistance Program. The basic application is made on Part III. You will need to get your personnel officer to complete Section IV.
Supporting documents. You will also need to include verification of home ownership, the dates you lived in the home, a copy of your PCS orders, the efforts you made to sell your home and whether or not it sold, and the details of your mortgage.
You must submit your completed application by mail to the US Army Corps of Engineers district rwhere your home is located. For more information about the district lines, visit the USACE contact page.
The Homeowners Assistance Program has not been finalized
Details for the Homeowners Assistance Program are not yet written into law and the requirements are still being negotiated by Congress. Here is the message from the HAP website:
DoD policy guidance cannot be displayed until after the interim draft rule is published in the Federal Register. The dates for publishing in the Federal Register and initiating applicant processing are not known. They will be highlighted on this web site when the information becomes available.
For more information, visit the Department of Defense Homeowners Assistance Program home page, or the Department of Defense Homeowners Assistance Program FAQ page.
Related posts:
- Extra College Money for Military Members and Veterans
- Tax Rules Affecting the Military, Part 1 Non-Taxable Income
- Free Tax Preparation for Military Members
- Texas Veterans Leadership Program
- GM Military Discount Program
Print This Post
| 
Email This Post
May 30th, 2009 at 12:51 am
Both the DOD website and the application form clearly state that eligibility is limited to those who can demonstrate loss of home values DUE TO MILITARY BASE CLOSURES ONLY! There is nothing that suggests help due to ‘the current economic crisis.’
May 30th, 2009 at 1:48 pm
Robert: Thank you for the additional information. This program has undergone several changes since it was first announced and I have updated it to reflect current information. Thanks for stopping by and pointing out the inaccuracy.
June 12th, 2009 at 9:19 pm
I’m a servicemember and has a property in Hawaii which I owned since Feb 2005. In June 2008, I got reassigned to Japan on a dependents-accompanied tour; while I have a temporary renter, I consider the house as my primary residence since family and I plan to retire in Hawaii as keep it for retirement.
When I applied to refinance my current 5/1 ARM to change it to a FIXED loan, I was disqualifed for the home mortgage application—was told that I can qualify only for investment property loan. I found this absurd!
Is there anything in the Stimulus Plan that covers this topic? How about Servicemember Relief Act? or Soldiers and Sailors Civil Relief Act?
Military reassignment to overseas location has put my family and I in an awkward situation…is there a relief for this?
June 13th, 2009 at 3:48 pm
Hello Arnel,
I don’t know what your options are, but I recommend contacting the agency in charge of this program. However, it is important to note that this program was designed 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.”
If you base was not involved in a BRAC situation, then there may not be anything that can be done.
Best of luck.
June 25th, 2009 at 11:17 pm
What I dont understand is why this program is only for people who owned the homes prior to 2006? I mean what am I missing here?
July 9th, 2009 at 7:05 pm
I agree with Dawn. I mean we closed on our house in Oct. of ‘06 and had to purchase the house due to being on a specail duty assignment without a base close by. We have now received our new orders to PCS to a base over 16 hours away and are in great fear of not being able to sell our house or get near what the current payoff is. Do you have any advice?
July 9th, 2009 at 7:13 pm
Hello Crystal, This program was designed 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 only advice I have is to contact the US Army Corps of Engineers (USACE) for more information.
August 3rd, 2009 at 5:57 pm
Can this program be applied to members who are separating from the military who need to move to find employment elsewhere?
August 3rd, 2009 at 10:17 pm
Richard, I believe it can only be used for people who have to PCS due to a BRAC.
August 13th, 2009 at 2:44 am
I am retiring from the military soon. Have owned a home in San Diego since 2003, but due to the housing/mortgage crisis cannot currently sell for what is owed. My home of record is Oregon. Is relocating to one’s home of record considered to be a PCS move and if so would that make one eligible for this relief program? I may have to relocate to find suitable employment. Thank you.
August 13th, 2009 at 7:35 am
John, I am not sure if relocating after separation from the military qualifies, but even if it did, you would still need to meet the first criteria – moving due to a base closure from BRAC.
September 1st, 2009 at 1:23 pm
what does the below new addition mean?
“certain other military service members who are required to move more than 50 miles because they receive permanent change-of-station orders”
does this alleviate the BRAC requirement or does there still need to be a BRAC action?
September 1st, 2009 at 1:29 pm
Larry, So far as I am aware, the complete requirements haven’t been 100% solidified. My best recommendation is to contact the US Army Corps of Engineers (USACE) for more information.
September 12th, 2009 at 8:41 am
All,
I submitted my application, with all of the requested information, to HAP in April and have waited patiently for the final guidance to be developed. At this time, the final guidance is being held up in the Office of Management and Budget and they have 90 days to review. I have been told that it has been in that office since late-July.
Like many of you, I continue to make payments on a house that sits empty and has lost approximately 40% of its value while I rent a house at my new duty assignment. I cannot rent the house I own because the house must be sold by 1 May 2010 per HAP guidance. I cannot sell at this point, even though I have a contract to sell the house, because I do not have the $155K to bring to the closing.
Well, my patience has worn thin and it is time for all of us to take action. I encourage all of you to begin a letter writing program to your Congressman and state Senators. You can also contact the Office of Management and Budget.
We volunteer to sacrifice our lives for this country, but are treated like second-class citizens as evidenced by the speed with which the Cash for Clunkers program was developed and funded. Please contact your Congressman and Senators.
If you were stationed at Ryan AFB, you can contact Congressman Bill Posey through the attached website or can contact his aide at Chris.Hill@mail.house.gov . http://posey.house.gov/
Kevin
September 12th, 2009 at 2:07 pm
All,
I sent an email to HQ USAF/A7CAH yesterday. It looks like it will be at least another 60 days before HAP will be able to start processing applications based on the fact that OMB will take another 30 days and then another 30 days on the Federal Register. Wish I had better news, but bad news is better than no news at all. Anyways, here is the response “OSD and HQ Army is aggressively working with the Office of Management and Budget (OMB) to finalize the “rulemaking” and publish in the Federal Register as soon as possible. There are a few issues still being resolved to include income tax liability and full reimbursement for mortgages that are higher than current value of the property. OSD informs they anticipate resolution within the next 30 days. Please be assured, AF leadership is aware of the delays in the implementation and keeping a watch on the progress. Also, the Army Corps of Engineers is position for speedy approval of benefits by already reviewing the applications submitted to date.”
September 22nd, 2009 at 1:48 am
Hi! I own a property in San Diego, Ca and is doing a short sale due to a PCS move. On the article, only military members who were permanently reassigned because of a Base Realignment and Closure (BRAC) during the mortgage crisis are qualified. Does that mean that we do not qualify? After all, we are forced to do sell our home because we could not find a renter who would rent it for the same price as our mortgage. And having only one income, it is impossible for us to keep our home and rent at the same time in a state where we got relocated.
September 22nd, 2009 at 7:31 am
Mae, based on my understanding, the program is only open to those who are moving due to a BRAC in their area. I recommend contacting the US Army Corps of Engineers (USACE) for information specific to your case. It can’t hurt to get additional information.
Best of luck, and thanks for serving!
September 27th, 2009 at 1:28 pm
Mae,
The program will be expanded to include those that PCS’d and not just those that PCS’d as a result of Brac. Please contact the HAP office in Sacramento 916-557-6850 or 800-811-5532. They should be able to answer all of your questions.
Kevin
September 30th, 2009 at 4:34 pm
All,
I just received a notice that HAP guidance has been finalized. Below is the verbiage from the email. Best of luck to all.
Kevin
Applicants,
It is my pleasure to announce to you that the HAP program has officially started as of this morning. As I’m sure you can imagine, we are busy trying to initiate the program, and would appreciate it if you could review all the new information posted on the website (http://hap.usace.army.mil ) before trying to give us a call. We hope to be able to notify all of you via mail by the end of October of your eligibility status. Again, we will notify you as quickly as we possibly can.
Please read the below information regarding your tax liabilities:
“Section 1001 of the American Recovery and Reinvestment Tax Act of 2009 (ARRA) expanded the categories of eligible beneficiaries of the Homeowner’s Assistance Program (42 U.S.C. § 3374) to include wounded, injured and ill, surviving spouses, and military members required to relocate during the mortgage foreclosure and credit crisis, and personnel impacted by the BRAC 05 announcement. Because section 132 of the Internal Revenue Code was not amended at that time, these formerly marginally taxable payments became very taxable. The requirement to withhold taxes on these payments prevents this program from successfully assisting needy individuals and those whom this program specifically intended to help.
“The House Ways and Means Committee introduced legislation to revise the Internal Revenue Code to make ARRA expanded HAP payments nontaxable. Just when this bill will be signed into law is unknown.
“Unless or until this bill is signed into law, current tax law requires USACE to withhold Federal income tax from HAP benefit and reimbursement payments amounts above applicant homes’ current fair market value prior to disbursing payments to applicants or lending institutions.
“Districts must, early in the application process, ensure applicants are aware of this tax liability and the Congress’ intention to change it. Additionally, applicants must be advised that state and local taxes may be due on HAP benefits as well as the Federal taxes withheld.”
We, at USACE, strongly recommend that you consult with a financial and/or tax advisor so that you will fully understand your tax liability prior to receiving HAP benefits. If you need this assistance, you can contact the Military OneSource at 800-342-9647, and representatives will be able to refer you to a tax/financial advisor in your local area.
October 10th, 2009 at 12:54 pm
All,
Geart news! On October 8, the House of Representatives, by a vote of 416-0, approved H.R.3590, the “Service Members Home Ownership Tax Act of 2009.” The bill heads to the Senate for its consideration.
The bill would make the following changes to improve how the homebuyer credit and Homeowner’s Assistance Program (HAP) provisions apply to service members (i.e., members of the uniformed services, members of the Foreign Service, and intelligence employees):
* The tax credit claimed on qualifying first-time home purchases in 2009 must be recaptured if the home is sold (or ceased to be used as a principal residence) within three years of the purchase. A more restrictive recapture rule applies to qualifying first-home purchases in 2008. Sec. 2(a) of the bill would amend Code Sec. 36(f)(4) to provide that the first-time homebuyer credit does not need to be paid back if after Dec. 31, 2008, the home is sold (or stops being used as a principal residence) by a member of the uniformed services, a member of the U.S. Foreign Service, or an employee of the intelligence community, in connection with a government order for qualified official extended duty.
* The first-time homebuyer credit won’t be available for purchases after Nov. 30, 2009 (unless Congress extends this tax break). Sec. 3(a) of H.R. 3590 would amend Code Sec. 36(h) to provide those serving on qualified official extended duty service outside of the U.S. for at least 90 days in calendar year 2009 with an additional year (until Nov. 30, 2010) to buy a principal residence and be eligible for the first-time homebuyer credit (if otherwise qualified). Additionally, those buying a home after 2009 but before July 1, 2010 under the change would be able to elect to treat the home as bought on Dec. 31, 2009, in order to claim the credit on the 2009 return.
* Sec. 4(a) of the bill would amend Code Sec. 132(n) to ensure that certain payments under HAP are exempt from tax. This would apply to HAP payments made after Feb. 17, 2009, to (1) wounded members (and their spouses) of the Armed Forces, Department of Defense, or the United States Coast Guard and (2) members of the Armed Forces that bought a home before July 1, 2006 and are subsequently permanently reassigned between July 1, 2006 and Sept. 30, 2012.
October 25th, 2009 at 6:26 pm
Thanks for the post Kevin that is great news about the tax exemption. We are in the same boat as many. We have split our family because of our PCS move this summer. Don’t want to jepordize our good credit, so we jepordize the family unit with the hubby and son in FL and the wifey and daughter in AZ in order to now maintain two households without depleting savings. Our HAP paperwork was submitted in April 09 only for them to add more items to our list to submit. As of Sep all papework was submitted to their liking and a phone call to acknowledge their receipt. Has anyone been assigned any type of HAP number? Just curious.
November 4th, 2009 at 4:33 pm
All,
The first HAP payment was issued from the Sacramento office yesterday. Follow the link to the article. Good luck all.
Arveta,
I was assigned case # 0163 in the Savannah district. HAP has already contacted #72 and has approached him about purchasing his house and selling the house the same day to the person he has a contract with.
Kevin
http://www.military.com/military-report/housing-assistance-program-pays-claim?ESRC=miltrep.nl
November 11th, 2009 at 9:19 am
All,
President Obama signed (HR 3548, Unemployment Compensation Extension Act of 2009) into law and thereby exempted Expanded HAP benefit payments from taxation. Applicants who received benefits and had taxes withheld, may apply for refunds from the Internal Revenue Service when they submit their tax returns.
Kevin
November 17th, 2009 at 3:02 am
Kevin…Where did you see that the house must be sold by 1 May 2010? I don’t see this in any info. I only saw Sep 30 2012.
December 22nd, 2009 at 11:45 am
All,
Was wondering if the Home Assistance Program will help me? I was active duty Guard when I bought my home in Panama City, Florida…bought around June 2006. I retired June 2009 and couldn’t get job locally so relocated to Navarre, Florida about 2 hours away…great move job wise but I couldn’t get nowhere near for rent what my mortgage payment is. Had renter for about 8 months but now am looking for another renter. Obviously we bought at the high-end of the market boom but now can’t sell the house without losing at lease $50k. Any info would be most appreciated!
Ron
December 22nd, 2009 at 3:52 pm
Ron, Based on my understanding, this program is designed for people who were required to move due to a PCS. You can check out the HAP site for more information, or to contact a rep who can assist you with your specific case. Best of luck.
January 21st, 2010 at 9:33 am
So, if I purchased my home after 2006 I do not qualify for this program?
I just receive my assignment in January 2010 and have to report on April 2010.
Because I am on assignment to the eastcoast, over 1900 miles away from my home. What does this mean in terms of my situation. I would hope my home sell prior because renting is not an option.
January 21st, 2010 at 9:38 am
Jose, The HAP is for bases closing due to a BRAC closure, not all PCS moves. Please visit the FAQ page for more details on the program.
Best of luck.
January 27th, 2010 at 3:21 pm
Ryan and all who say this program is for BRAC only. Please read the FAQ page and Expanded HAP rules. It applies to all personnel who are required to PCS beyound 50 miles and who purchased a home on or before 1 Jun 2006.
January 28th, 2010 at 12:20 am
Thanks for the update, Charles.
February 24th, 2010 at 7:31 pm
Please help me out… I am confused on if I qualify. I purchased my home in Nov 2007 and just received PCS orders for one year and I will receive a new set one year later to who knows where.. I live in the DC area and we have been hit really hard and a loss of over 80K on homes. BRAC is bringing folks to the area but I know the new changes state you don’t have to be affected by BRAC to qualify. Please help me out.
February 26th, 2010 at 11:34 am
We are in a similar situation. We bought our home in Tampa, Fl in March 2007. We tried to stay here for another tour so we could save our home, but was denied. We have orders to DC in August. What do we do with our home? We won’t be able to rent it for what our mortgage is and we certainily can’t sell it ($50,000 loss). The Hap program does not apply for us. Where can we go for help. Is our only option a short sale?
Melissa
February 27th, 2010 at 8:09 pm
We are on the same boat then.My husband and I have to move to Ill in June , and we bought our house back in May 2007. I called HAP for help , the reply was ” sorry we could not help you” . What should we do ? Plz helppppppppppp
March 1st, 2010 at 4:06 pm
Melissa, I recommend trying to work with your lender. You are a few months out, so they may try to work with you to avoid a foreclosure or short sale. It may be possible to rework the loan or rework the terms to make the payments more affordable. I know that doesn’t solve the problem, but it may help, and lowering the monthly payments may make them low enough that you will be able to afford to rent out your home either for cost, or at a small monthly loss. It’s not a perfect solution, but it may be feasible. Beyond that I am not sure your options. I wish you the best.
March 1st, 2010 at 4:08 pm
Trisha, I recommend contacting the folks that run the program. There are many varying factors that could make you eligible or ineligible for this program. The people running the program will be able to give you the best information based on your situation.
March 1st, 2010 at 8:49 pm
I live in Yuba City CA, I bought my home for 300,000 in February 2007 and now I am faced with a PCS to Texas in June. My house is now worth 195,000 dollars, a HUGE loss! I can’t even get near my mortgage payment by renting out, about a 800 dollar loss a month. On top of that I lose my tax incentive of paying interest only on my loan since I am getting “extra income” I am 6 months short of making the cut off? That seems a little unfair the market didn’t really crash until the summer of 2007. I don’t know what to do.
Any help or suggestions from anyone would be great!