What Help Is Available If You Are Facing Foreclosure On A VA Loan?
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What Help Is Available If You Are Facing Foreclosure On A VA Loan?

Most veterans are unaware of what options they have if they are facing foreclosure. There is a seldom used program that will help a veteran sell their200-530 home using a short sale. The program is called expanded HAP.
What is expanded HAP?
To understand expanded HAP, you must first understand what HAP itself is. HAP stands for Homeowners' Assistance Program and is granted to eligible service members, as well as federal Department of Defense civilian employees. The program was established by law and is enforced by the US Army Corps of Engineers (USACE).
It works by offering assistance to homeowners who fit the program's eligibility criteria and are suffering financially with the process of selling their VA homes as well as struggling to pay back the full amount of their Veterans Administration home loans. The program is designed to provide a way out of a mortgage that causes a financial hardship.
The economic recession has left many people without the ability to pay their mortgage payments. When eligible homeowners are forced into a short sale (when the sale proceeds amount to less than the amount still owed on the house), the USACE will subsidize both a borrower's and lender's loss on a VA loan.
Expanded HAP was put in place to help service members and their families in desperate need due to financial hardship, illnesses, injuries and even deaths while serving or as a result of military service.
The American Recovery and Reinvestment Act of 2009 (ARRA) seeks to help additional service members who encounter difficult circumstances as well as Department of Defense (DOD) employees. The new list (expanded definitions) take into account a broader range of service members as well as the current state of the economy, which avoids placing blame on service members and their families who are victims of circumstances beyond their personal control.
HAP was originally intended to provide assistance for service members during special situations such as base closures and PCSZF-100-500 (Permanent Change of Station). This took into account the loss some members of the military had sustained while selling their home in the event of a short sale.
In this circumstance, it was understood that the short sale was beyond the service member's control. Expanded HAP takes into account ALL scenarios and ALL loan types (not just VA loans) where circumstances are beyond the service member's control, in addition to providing coverage for those who contribute to serving our country such as civilians, active duty military and surviving spouses.
If you are unable to find a buyer for your home, the United States government will actually purchase the home from you.
These cases aren't as rare as you might imagine due to the current decline of the housing industry coupled with the economic recession. What distinguishes traditional short sales from short sales with expanded HAP coverage is that there is no tax liability for those who qualify for VA HLC HAP.
This rule was established on November 11, 2009 and has since helped relieve many service members and their families who are struggling in the financial crisis. Expanded HAP covers all of those involved in serving and protecting our country while providing extra coverage for the serving members themselves.
What this means is that your VA HLC approved Realtor will be able to facilitate a short sale with full mortgage payoff at no cost to you. There is an added benefit in that your VA eligibility will be immediately restored allowing you to buy a new home using your $0 down VA home loan benefit.
This program not only shows support for the brave men and women who have served in the military, it lends a helping hand as a gesture of gratitude. By offering assistance to military members and their 9L0-406families who are struggling to sell their VA homes and pay back conventional, FHA and VA loans, we are able to show our deep appreciation for their services.