HAP Program Helps Some Homeowners Hurt By Falling Home Values

For more than 40 years, the Homeowners Assistance Program (HAP) has compensated eligible military and civilian federal employees who saw their home values drop because of a Base Realignment and Closure (BRAC) decision to close a nearby military installation.

The program was temporarily expanded in 2009 to provide financial assistance to a wider audience in the wake of the financial crisis and housing market meltdown.

Home values plummeted, making it more difficult for military homeowners to sell their home without taking a major monetary loss.

How HAP Helps

Homeowners who meet the eligibility requirements can basically receive help in four ways:

• Get reimbursed for part of the loss from selling your home
• Obtain financial assistance to pay off your mortgage if home sale proceeds fall short
• The government can step in and pay off your mortgage
• Foreclosure assistance

Some eligible homeowners can be reimbursed up to nearly 100 percent of the purchase price. Service members who moved because of a PCS and civilian employees hit by BRAC 2005 can even have their closing costs covered.

The government can decide to purchase a property (at 75 percent of the purchase price or mortgage payoff) from homeowners who can't sell within 120 days.

The program is exempt from federal, Social Security and Medicare taxes. Some states may impose a tax on HAP benefits.

The eligibility requirements for the Expanded HAP program are lengthy. It's probably easiest to check out this two-page brochure created by the Army Corps of Engineers, which essentially coordinates the program. Calls and questions should go to the Army Corps' district office in Savannah, Ga., at 800-861-8144.

Who HAP Can't Help

While the eligibility information is exhaustive, there's a relatively short list of homeowners who are not eligible for financial compensation through HAP. Here's a look at those six categories:

• Service members who retired before their mandatory retirement date
• New accessions and service members entering active duty
• Service members who voluntarily separated or discharged
• Homeowners with a discharge or separation characterized as less than honorable
• Service members who ask for and receive Release From Active Duty (REFRAD)
• Service members who are REFRAD for poor performance or misconduct

How to Apply

You can download the application (DD Form 1607) and other materials from the HAP website.