Homeowners Assistance Program (HAP) is Working for Military Families


In January five of my military client’s closed on the sale of their homes using the Department of Defense (D0D)-Homeowners Assistance Program (HAP). Yes if it is a military related program it is going to be full of acronyms.

For many military families in the Northern Virginia area there is no doubt that the stress of a PCS move alone is high. Add the possibility of facing a short sale and the stress can go off the scale. Fortunately as part of the Economic Stimulus Relief Act military families who were under contract to purchase a home prior to July 1, 2006, have PCS orders prior to September 1, 2010 and have lost at least 10% of the market value of their home can apply for HAP benefits.

The program offers military sellers a chance to move without having to go through the painful process of a short sale and the possibility of ruining their credit. This is huge for anyone with a security clearance and with military families where moving every three or four years means credit checks for new housing (either buying or renting) ruined credit could be devastating.

For more program information you can go to the USACE HAP website.

If you are a military family living in Northern Virginia and meet the qualification for the USACE HAP program give me a call at 703-346-2213. I’ve settled HAP transactions and have more under contract. I understand the process, the lingo and know what it takes to get your Northern Virginia home SOLD.

119 thoughts on “Homeowners Assistance Program (HAP) is Working for Military Families

  1. I wish more civilians would just understand what this program is all about. It is SO FRUSTRATING to have real estate agents discriminate against my home because they think the HAP only amounts to a short sale! I wish buyers understood what a great deal a HAP home is for THEM. They can get a home for up to 10% BELOW CMA, and there is no “wait” or “begging” involved. PLEASE EDUCATE REAL ESTATE AGENTS, because TOO MANY HAP HOMES are languishing under false assumptions. I have three friends who closed since December, and their processes took only the traditional 30 to 45 days. HAP has a PR problem from last year when it couldn’t get its wheels moving, but now they have money to disburse, and no civilians trust that it isn’t a dead end process “like a short sale”. I consider HAP the best keep secret benefit out there, and if you can do the whole $8K tax perk, a buyer can benefit TWICE in this market if he hurries!

  2. Janice-I’m not sure where your home is located but I have not had any issues with my HAP listings selling. I will have to disagree with your comment that they can get a home up to 10% below CMA. One of the criteria of the HAP program is that a home be sold at Fair Market Value and they want comps and do an automated appraisal process to make sure that homes are not being sold below value. Otherwise you are correct it is not a short sale and does not require any type of lender approval. Hopefully your home will go in the SOLD column soon.

  3. I am in a unique situation and need help. My wife and I purchased a home in San Diego for $442K in 2005 with Country Wide (now BofA). In 2006 we refinanced our second into a HELOC with USAA and paid off $36K of debt. We now have orders to Chicago and got approved for the HAP program. The only catch is that the program will not pay the $36K that we took out. I understand this and am not upset about it. However, this means that to get the program to go through, we need to bring $36K to the close of escrow. We dont have the money. I am not trying avoid paying the money but I thought it would be a good idea to contact USAA and BofA to tell them that we are approved for this program. I have been asking them to forgive the $36K in order to get the program approved. Otherwise, as we are $200K negative in equity, USAA will get nothing and BofA will lose $80K minimum. I have tried every loss prevention number provided and I cannot get high enough up in the company to speak with someone who can help me. I understand that the $36K is my fault…no need to elaborate on this, but I am trying tell the bank that they can forgive the $36K or lose $200K. Our only other option is bankruptcy. We have until August 2010 to close. Can anyone advise some help?

  4. Jerimie-the only think I can suggest is to talk to USAA about converting your HELOC to a personal loan and then ask them to release the lien from your home so you can close using the HAP benefits. Bankruptcy has significant long term effects on your credit. Sellers often are under the impression if their home goes to foreclosure that the lenders get nothing. Most loans are insured and as a result the lender are covered for some or all of their loss. It is a long shot to get them to convert your HELOC but certainly it is worth asking about the option.

  5. Is there ANYTHING available to military that bought after July ’06? We bought in December ’06, closed in January ’07 and just got spur of the moment orders to move. Our house lost about $20K in value. Now we’re stuck. Any advice?

  6. Unfortunately I have a couple of families in your same situation. The applied to HAP for an exception and were told NO, one only missed the deadline by 26 days, unless there is a rule change the current dates are firm. Unfortunately your choice becomes a short sale but most lenders do look at PCS orders as a hardship and will even process without a missed payment. If you have a VA loan you can also go for a VA Compromise Sale. Sorry as I know there isn’t an easy way to make a forced move and be in your situation. If you live in Northern Virginia and I can be of any more assistance don’t hesitate to ask.

  7. I have just placed an offer on a HAP home. I am a first-time home buyer. What is the process? How long will it take for my offer to be accepted or denied and who does that the seller or the military? The house that I am trying to purchase has been on the market for 13 months and has been reduced by 30,000. Also, how long does it take to get a closing date?

  8. Laura-since you are working with an agent I can’t speak to any specifics but give you a general outline. The owner ratifies the contract and as long as the offer is at Fair Market Value there should no issue. HAP does not “approve” the sale only processes as long as the owners have done their part and filed all of the required paperwork. I have found my most recent sales are closing within 60-75 days but each district may have different time frames based on the volume of applicants.

  9. This comment is to Jerimie. My husband and I are in the same situation. Bought in 2004. Did a refy in 2005 AND 2007. About 40K debt is ours. The mortage is $350K and the house is worth $140K (Modesto, CA). We PCS’d to souther California in 2008 and decided to short sale our homes about 5 months ago as the HAP was taking to long to get up and running. About a month and half ago I decided to check on our application and the status and was pleased to find out that they were now working on PCS’s in 2008. We had started a short sale and had an offer so we were told to send everything over to the HAP office in Sacramento. The HAP Realty Specialist is working on our case. He’s going to negotiate on our behalf with our lenders to agree to an amount as “paid” or “paid as agreed”. Basically, our first will get paid all but about $8K and the second will take a loss of about $40K. Our second is supposed to charge-off tomorrow, but we’re going to make a payment to buy some more time. The bottom line is that you need to talk to an experienced person with the HAP so that you can be well-informed of what your options are. I’ve been working on this for over a year and I’ve talked with many people, but unfortunately there was too much that was up in the air and I was given wrong information/bad advice. I’m keeping my fingers and toes crossed that this all works out and our credit stays intact (other than some late pays for missing our mortgage payments). I’ll update when this all finalizes in the next month or so.

  10. Hi Cindy,

    I am a first-time home buyer as well. I am interestedc to purchase a house that on ‘WORKING WITH MILITARY HAP PROGRM’ in Virginia. Who qualifies to purchase such houses and how long will the process take. Thanks.


  11. Anna-anyone can buy a home that is being sold by a military family under the DoD HAP program. Expect the process to take between 60 and 90 days. Make sure your agent gets the details regarding where the owners are in the process of the program. Good luck.

  12. I had a ratified contract with a HAP seller. He did not qualify for HAP since his purchase price and selling price did not show greater than 10% loss. He also owes $160K in money he took out of the house when the value was high. He is currently in Kentucky and selling property in Northern VA. Basically, he can only rent the property until the debt comes in line with the property value, which could take 10 to 15 years. If I was the bank, I would be happy if he paid off $340K of the debt and then found some other way to pay off his $160K. I even figured he could lower the price by $10K which would demonstrate a greater than 10% loss, and put it through the HAP again. I would assume this might work, but he would still have $160K outstanding. I would still ove to buy this house, are there any alternatives? Any suggestions?

  13. Cindy-

    I recently put a contract out on a HAP property (and had an addendum that the HAP respond in 30 days) – my realtor feels confident that we should get a response by then (this is her first time with a HAP property). From your experience, is 30 day enought time? Once the sellers signed the contract with us, they then proceeded to apply to the program.

  14. Mel it depends on what type of response you are looking for. I can’t speak to your specific contract but my sellers all have filled out the application and provide HAP with the initial required documentation before the house goes on the market. Then we provide any paperwork and the ratified contract. It can take anywhere from 60-90 days for HAP to finalize the benefits from the time a ratified contract is received. Hopefully the listing agent can fill in all of the other details for your agent.

  15. Cindy-
    Thanks for your response. Unfortunately, the sellers only filled out their application after they signed the contract. The sellers realtor and my realtors said they were confident that the contract would be ratified in 30 days (e.g. HAP approves the sellers application/HAP approves of the price of the home).

  16. Mel-Good luck. There are a lot of components to HAP. Hopefully the seller has spoken to a HAP realty specialist to assist them with getting the right documents together for their application to be complete for processing.

  17. Mike-HAP only covers “qualified” refinances and from my conversations with HAP realty specialists that means if an owner took money out of the home in a refinance they may not qualify for HAP benefits. The seller should speak with their lender(s) about other alternatives if they do not qualify for HAP benefits and want to sell.

  18. Thanks for your wonderfull work in putting this together! Your article is much better then others i have found writing about this subject. Thank you so much for your help in helping me understand this subject.

  19. Your welcome. I have the good fortune of working with a number of families who are eligible for HAP benefits. We’ve been successful in closing deals so they can move on to their next duty station.

  20. Cindy-
    Thank you so much for starting this q&a regarding HAP. I am in the process of buying a home in DC that has been HAP approved and I know the owners are working closely with them so we can close as quickly as possible. The one question I have is, does HAP have to approve/sign the contract for it to be considered ratified? From the previous comments it sounds like they do NOT have to sign it for it to be ratified, but I just wanted to confirm. We are first time homebuyers who are hoping to qualify for the housing tax credit that ends very soon!

  21. Thank you for stopping by. No the contract is ratified when the homeowner signs it. HAP does not sign your offer. Good luck with your new home purchase.

  22. I have a quick question. I’m getting ready to submit my paperwork to the HAP program do I need to list my house if I have a buyer. My renters want to buy our home. I’m going to go with you Cindy as our realtor but I’m not sure if we have to list it first before sending in the paperwork. And can our renters us you to do their paper work as well? Thanks!

  23. Dena-if you can show HAP that you have sold your home at Fair Market Value then you should not have an issue with selling the property to your tenant. If you are in the Northern Virginia area I would be glad to assist you with the market analysis and required contract paperwork to send to HAP for a sale to your tenants.

  24. Cindy we haven’t sold the house and don’t want to until I find out how much we are going to have to come to the table to close. I’m not sure how it works. We will be taking about a 100,000 lose. Our renters are living in the house and are willing to wait. We have another year of lease with them. But I wasn’t sure if we needed to list with you now for one day and than take it off the market because they really want it. I know you have to show the attempt to sell. Like I said I’ve done the paperwork and going to make copies to send off but they said we need to show attempt to sell and we haven’t done that because we have a buyer that we found. Look forward to working with you. Dena

  25. Cindy,

    Thank you for writing this article. I will be submitting my application this week and I am praying it gets approved. I am not in your area so can it be a by owner sale? The online appraisal shows we owe over 50k than what our home is worth and it is close in comparison to what the other homes in our neighborhood are being sold for. If I list it at that current appraisal price will that suffice for the HAP application. You have no idea how happy I was to come across your article. Thank you

  26. Cindy,

    I forgot to ask in my previous post if an estimate from Zillow would suffice for HAP or am I required to get an appraiser? Thanks

  27. Mary-I would not rely on Zillow pricing. Though I don’t know where you live and I have respect for the team at Zillow the zestimates are not always an accurate reflection of market value. You should either have a local Realtor® familiar with your neighborhood run a CMA for you or hire a local independent appraiser to determine Fair Market Value.

  28. Dena-I’ve sent you an email. Let me know if you received it and need any additional assistance.

  29. Cindy,

    I just wanted you to know I thank God that I came across this website you have been such a wealth of knowledge. Thank you, Thank you so much for sharing this information it is definitely a blessing to my family and I. Doing a search and finding this site is the reason we have decided to take a step and submit our HAP application I cannot thank you enough. Please keep up the great work. God bless you always.

  30. Cindy I didn’t get the email can you resend it! We sent paperwork to Hap and now we are waiting to see if we are approved. Should be put the house on the market now or should we just wait to see if we are approved? We have a buyer but not sure how that works if we actually have to put it on the market.

  31. Dena-sent you another email. This time it is coming from my Gmail account. Check your spam folder.

  32. Hi Cindy thanks for this website. I live in the Hampton roads area. We put a contract on our house in March 2006 for 322,000. My husband has pcs orders for June 2010. We are just starting the paper work for the HAP program. We put no money down on the house and we owe 313,000. I was wondering what I may need to come up with at closing. I am dealing with a realtor that is not familar with the program. He came over yesterday to do CMV. I should have that in a couple days. But it is not looking good around 270,000. Thanks so much if you are able to answer any question.

  33. Karen,

    Though the officials at HAP are the final word on your exact $$$ needed at closing I would suspect based on the information you provided that your will participate in HAP Government Acquisition (GA). Once a buyer is found for your home and your contract is processed the USA will “acquire” your home & then the same day sell it to the buyers who are under contract to purchase your home. The most any of my clients have come to the table with so far has been less than $5000 and primarily that has been to make sure that all of the taxes and interest due on their loan is up to date. Don’t worry about the amount you are upside down as long as your area is 10% below market from when you purchased.

    Good luck and best wishes on your new duty assignment.

  34. Cindy:

    Just left you a voicemail message. We bought our house in August 2007 for $308,000. We live in a gated lake community in Caroline County, VA and our realtor says that we are upside down and our house will not sell for the price that we bought it for. He says that the most we will probably get is $220,000 because of the comparables in the area. In addition, I am active duty and have PCS orders for Richmond, VA beginning 1 JUNE 2010. I am currently stationed in Washington, DC. Any assistance that you can provide with the HAP Program will be greatly appreciated.

  35. CPT Jackson-based on what you have included in your email you unfortunately do not qualify for HAP. You must have purchased or been under contract to purchase your home by July 1, 2006 in order to qualify. I’ll check my VM for more details. If you have a VA loan your next step is to consider a VA Compromise Sale. Your Realtor® can get more information on the program at the Roanoke Regional Centerwebsite.

  36. Hi Cindy,

    I live MD and just got a ratified contract for our home. In your experience how long has it taken for HAP to run the appraisal and give approval for the program? All my paperwork was submitted back in Feb and the contract was submitted yesterday. Do you have any advice on how to get HAP to give initial approval as quickly as possible?

  37. Patrice- If your agent sent comps along with your contract that shows your home was sold within 10% of Fair Market Value the internal desk appraisal run by HAP should not be a problem for you. Be prepared for about a 60 day process. There isn’t much you can do to push the specialists as they have a heavy workload. Just keep in close communication and respond quickly to all requests is key.

  38. Thank you for your quick response. We put a close date of July 30th to cover over 60 days, but I was told that we could get initial approval after the appraisal. In your experience is that true. We have put in our contract that we will end our contingency of the sale when we get HAP approval. HAP originally told me that it would take 2 weeks, but when I called yesterday they said their workload was high and now I am nervous we are going to lose our buyers. In your experience how long has it taken to get the initial approval?

  39. Hi Cindy. First of all, thank you for your website. It contains a lot of helpful info. I’m hoping you could shed some light regarding my situation. My family is PCSing to Japan. My husband is already there and my children and I will follow in July. I know we are qualified for HAP — bought the house on May 15, 2006; it’s our primary residence, my husband received his PCS orders last October 2009.
    The first agent we talk to persuaded us to go for short sale instead of HAP saying it is much faster than HAP. Since our lender is Wells Fargo, we should be able to sell our house within 60 days. We were about to do this, when another agent told me that she is an expert with HAP sales and told me that short sale is not the best way for us especially since we are qualified for HAP. We plan to buy another house after our 3-year PCS in Japan. We have a very high FICA — above 800. We still want to use VA loan when we apply for our next house. I’ve read so many negative things about HAP, especially the Savannah branch. What do you think we should do? Go with the first agent and short sale our house or go with the 2nd agent and go with HAP which I know would take forever? Thanks in advance for your reply.

  40. Nina-Unofortunately one of the myths about the HAP program is the length of time it takes to process. I attribute this to last summer when the program was announced but the funding was not available to process applications. As of this week I will have settled 10 HAP transactions in Northern Virginia. The last few that have closed have been 60-75 days. Since you already have orders from 2009 your file will be processed faster than one with orders for July 2010 for example.

    A short sale will have a negative impact on your credit. I certainly wouldn’t recommend going that route with HAP benefits available to you. Make sure that the agent you are talking to about HAP has closed HAP transactions and knows the various options you have available to you in the program. Even if it takes a few extra weeks to close with HAP benefits it is well worth the wait.

    Good luck with your move.

  41. We got orders for PCS to Georgia in Feb 2006. We then bought a home in Georgia, closing in May 2006. We got orders to PCS Sept 2007 to Pentagon. We split the family up and left wife/kids in the home for 1 year in Georgia, then moved them to DC area in July 2008. This GA house sat vacant and on the market from July 2008 – May 2009 (all the while we kept current on the mortgages — 80%-1st and 15%-HELOC used for orig purchase). There was no rental market to speak of, so we could not rent it. We finally sold this Georgia house in May 2009 for approx 12% loss, plus the loss of monies paid for vacant house . . .

    It looks as though we qualify for HAP in some way, yes?

    We are currently renting in DC area and would really like to recover some monies via HAP to help us possibly buy a home again. We never were late on the GA house payments and have stellar credit ratings, just little liquid cash after what it took to pay that mortgage and pay at closing to sell the house. Is there hope?


  42. I would suggest that you go ahead and put together your HAP application and send it to the Savannah Regional office. You won’t recover for a vacant home but may have some funds due to your for Realtor® fees and closing costs.

  43. Hi, Thank you so much for your article and for helping other military home owners with this struggle! I am wondering if you can shed some light on our situation.

    We have submitted the application for HAP and do qualify under the expanded program. We bought our house in June 2006 and are losing 100,000. The comps in our area are going for less per sq ft than what we have listed our home for sell. We got 2 offers within the first week. We waited to respond as we were told not to accept within the first week. One offer was for what we listed plus they wanted us to cover 3% of their closing costs and purchase them the home warranty. The other offer was for $5,000 more than listed and no extra strings attached plus the buyers have 17,000 as a down payment, so we went with the 2nd offer.

    My question is, have you had a scenario like this where the buyer offered to pay more than the price listed and what did HAP have to say about this if so? We are not sure if this means HAP will say we could have gotten more since these buyers have offered more than the asking price. Anyhow, we have signed the contract and sent the contract into HAP. We are still awaiting the appraisal as we have an addendum for the buyer to disclose this within 30 days. Have you had any similar situations and what was the outcome?

    Also, have your HAP sellers had to come at closing with money or has HAP paid out at closing rather than being reimbursed? Anything else you can add that might be helpful or reassuring would be great!


  44. Randy,

    Yes I have had listings where the homes received multiple offers and sold for above the list price. You say you are waiting for the appraisal which makes me think you believe that HAP has to approve your sales price. As long as your home isn’t being sold for under Fair Market Value (FMV) HAP isn’t going to “approve” your price only agree that the home meets the FMV criteria.

    What you need to be more concerned with is if the buyers lender will appraise the property for the contract price. If the contract is for more than others have sold for in the neighborhood then that is where your issue may be. Hopefully you they are getting their appraisal done (if there is an appraisal contingency) to make sure you don’t have to change your sales price.

    All of my sellers have closed with HAP benefits in place with no waiting for reimbursement. I have two this week.

    Good luck!

  45. Cindy,

    I have read through your responses. We recently- 5/15/10 put a contract on a home in the HAP Program and live in NOVA. If I am reading correctly, you are saying the entire process has been taking you 60-75 days recently, and this would INCLUDE the final closing period after the military HAP approval/processing has been completed. Just confirming that’s not 60-75 days just to get HAP “approval”. I understand it can vary depending on a variety of factors, but was just curious.

    Also, the listing said it was HAP, but how can we as buyers be 100% sure the sellers already submitted their HAP paperwork and were actually approved for the program? Thanks,


  46. I have a quick question. Been doing a lot of reading and searching on the HAP. We bought our house in December of 2007. And we PCS in Nov 2009 to Japan. We could no longer afford our home and now have gotten a foreclosure notice. Have been trying to sell the home since Aug 2009. The home is located in Norfolk. On the HAP brochure it does not say that we had to own the home prior to July 2006. We are in Japan now and the information that was given to us here is that if we cannot sell the home, become default in payments, and PCS before Feb2010 we should be ok. Is this really true? Our agent has been working hard and we have lowered the price twice and have the shortsale on it. We DO NOT want the house to go to foreclosure. If I hadn’t moved and left my job I suppose things would have been different but I came over here and now he is deployed. Any advice? I have no clue on how foreclosures work. I just know that we cannot afford our house and we can’t seem to get a buyer and now we got a notice for foreclosure. Thanks for the Help in Advance.


  47. Rebecca-the HAP program is for homes purchases or under contract prior to July 1, 2006. Since you bought your home in December 2007 you would not qualify for the program benefits. I”m sorry that you were not able to sell your home via a short sale prior to receiving a foreclosure notice.

  48. Johanna-circumstances vary on a number of factors in the process including which benefit option the seller may be taking. There is no formal “approval” for the program but if they meet the criteria outlined on the website and provide all of the required documentation then their file is processed. Ask your agent to talk to the listing agent to verify where the file is in the process.

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