Help for Military Homeowners

The National Military Family Association has heard from military homeowners across the nation regarding their struggles with selling a home when they have orders to relocate. We are pleased the Office of Servicemember Affairs has continued to push for solutions. Holly Petraeus outlined the challenges of military homeowners and new guidance issued by the Department of Treasury in her blog:

Military families throughout the country are not immune to the ongoing housing crisis. On my travels to military bases, I’ve heard too many distressing stories about service members who are underwater on their mortgage and are faced with military permanent change of station (PCS) orders that require them to relocate at a time when their home is worth less than what they owe.

This problem has forced some military families into the costly and stressful situation of maintaining two households, with the family remaining behind while the service member moves alone. Other service members have had to let their homes be foreclosed on.

This situation cannot be addressed by the Servicemember’s Civil Relief Act (SCRA), which applies only to pre-service mortgages. The military homeowners affected by PCS orders are on active duty and are likely to have assumed their mortgage after they entered the service.

These service members may have been faithfully paying every month but will no longer be able to keep up once they move. They may have a smaller housing allowance at their next duty station and a loss of income as their spouse tries to find new employment. They can’t sell their home for enough to pay off the mortgage and they often can’t rent it for enough to cover the mortgage payments.

So, PCS orders can put service members in a financial bind that is hard to escape. They’ve told me that when they ask for a short sale or loan modification, their financial institution has answered that they need to be delinquent in order to be considered as having a qualifying financial hardship. Deliberately defaulting on a loan is something no service member should be asked to do.

In the last week of September, the Treasury Department announced updated guidance to its Home Affordable Foreclosure Alternatives (HAFA) Program that may help in some circumstances. HAFA pays incentives for a short sale or a deed-in-lieu of foreclosure used to avoid foreclosure when a borrower is financially unable to continue to pay their mortgage. Under the new guidance, service members who cite a PCS order as the basis for their financial hardship when asking for help under HAFA will now be eligible even if their income has not decreased.

Our Association appreciates this guidance and encourages policymakers to continue to work together to provide solutions for our military homeowners. Military homeowners, will these changes help you? Email us at


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