SACRAMENTO, Calif. (Feb 17, 2010) - In its beginning, the Homeowners Assistance Program (HAP) aimed at helping military families and civilian personnel affected by Base Realignment and Closure (BRAC), with the U.S. Army Corps of Engineers (USACE) operating the program on behalf of the military armed forces branches.
In 2009, the American Recovery and Reinvestment Act (ARRA) expanded HAP to provide assistance to wounded servicemembers or Department Of Defense (DOD) civilians reassigned due to medical or rehabilitation purposes or retirement due to their disability; surviving spouses of the fallen; BRAC 2005 impacted homeowners, and servicemembers undergoing a permanent change of station during the mortgage crisis.
Since the availability of additional funds provided by ARRA in late 2009, the Sacramento District of USACE has helped nearly 250 applicants through HAP. The Sacramento District real estate division oversees HAP in 10 western states, as well as American military installations in the Pacific region.
A new component, initiated last month, now allows the program to assist qualified applicants in the direct sale of their homes in two specific ways: reimbursement at closing and government acquisition.
For a straight private sale - where the applicant doesn't have the funds to close - HAP can help, said Janice Will, lead real estate specialist with the Sacramento District's real estate division.
"There's a chance to do a reimbursement at closing," Will said. "If the applicant's outstanding mortgage is under 90 percent of their prior fair market value, including upgrades, then we can go ahead and assist them at closing,"
This can include the reimbursement of any customary closing costs.
"On the other hand, in the case of the outstanding mortgage being greater than 90 percent, then you're looking at a government acquisition," Will said. A buyer is still present, but the house is purchased by the real estate division, then immediately sold to the buyer. This process has already been used at the Sacramento District for nearly a month.
In both cases, a buyer is required, and the applicant's loans still need to be eligible, Will said. This means none of the loans were taken out after the purchase of the house, unless done so specifically for upgrades to the house.
A surviving spouse of the fallen may ask for assistance without the presence of a buyer though, Will said, as they may not have the immediate opportunity to find one. The Corps' real estate team would then buy their home and immediately place it on the market.
The home is placed on the multiple listing service (MLS) with the assistance of a local real estate agent in hopes of selling it quickly at current market value, said Will. This process has already resulted in a handful of homes being purchased.
There is no effort to make profits on the sales, Will said. Such an effort would require upgrades being performed on the home and more money being put into it, she added.
HAP is a Department of Defense program originally approved by Congress in 1966.
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