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Bailout package to help military families

  • Published
  • By Lt. Ian Burgess
  • Command Financial Specilist
It's known as the Homeowner's Assistance Program and is run by the Army Corps of Engineers. 

Primarily started as a program to assist families negatively impacted by base-realignments, new regulations have expanded it to include "members of the Armed Forces permanently reassigned during the mortgage crisis."

This program has two main benefits that are ultimately intended to limit your losses on the sale of your home when you move to your next duty station. 

The two categories are private sale reimbursement and government purchase. If you sell your house for less than 90 percent of what you bought it for, then you will be reimbursed up to 90 percent including the closing costs. You would be responsible for the remaining 10 percent, which wouldn't be too bad if you put anything down at your purchase time. 

If your house fails to sell at a reasonable price after 120 days, the government will buy it from you for 75 percent of the original purchase price, or the current total amount of
outstanding mortgages, whichever is greater. Unfortunately, any benefit paid to you will be taxed as regular income.

There are some pretty specific dates you must meet to qualify for the program. First, you must have purchased or signed to purchase your home prior to July 1, 2006. Then, the home sale must result from Permanent Change of Station orders issued on or before Dec. 31, 2009. Finally, the application must be received by March 31, 2010. 

The recent suspension of PCS orders creates a small window of opportunity so if you qualify, act fast and remember that you must mail in the application.

Here are a couple more restrictions to keep in mind. Foremost, these benefits only apply to your primary residence. Standard PCS guidelines apply. For example, you must actually relocate more than 50 miles. 

The maximum government purchase amount is $417,000 for most areas and up to
$729,750 for parts of the country with a higher cost of living. If you are interested in buying a house from the government, listings are available at the Army Corps of Engineers Web site or HomeSales.gov. 

Specific procedures are still being developed which could dealy any benefits up to six months, so make sure you're prepared to wait.