Veteran's Day Report: Military & Foreclosure

Military foreclosures are surging at FOUR TIMES the national rate! This is a disgrace!

Why is this happening? During the subprime boom, soldiers were a target of lenders selling “no/low down payment mortgages”, and soldiers chose initial lower rates and “easier” term mortgages instead of home loans offered by the Veteran’s Administration. Now, cities with large military populations are being decimated by foreclosure and bankruptcy filings, even while the homeowners are serving overseas.

The Servicemember’s Civil Relief Act does offer aid to deployed soldiers – it protects soldiers and sailors from losing homes for nonpayment of mortgages only while on active duty and for 90 days after they return home (members of Congress are now working to extend the time period up to 12 months). However, the burden is left on the servicemember (or their family) to communicate with the lenders and provide the paperwork necessary for rectifying the situation. Not necessarily a bad thing, especially since I am a proponent of taking control of your own situation. However, let me tell a short story to illustrate how difficult this is.

My brother is in the Army and is currently serving in Iraq, and the registration on his car was expiring. My father went down to the DMV to renew the registration, thinking this would be a simple, easy process. Well, after TWELVE weeks and THIRTEEN trips to the DMV, the situation was finally rectified, but there was nothing simple or easy about it! It took a military power of attorney, an original copy of his orders, proof of current insurance, proof of storage AND intervention from the local recruiters office… it went on and on for months! And this is just the Department of Motor Vehicles! For those of you who have dealt with lenders, you know that some can be infinitely worse!

The pressure of war is immense, and many of our soldiers get very little leave to deal with their home situations. Congress should be doing more for military families who are faced with losing their homes. It’s not too much to ask for those who are serving our country.