Hello fellow military families,

 

I am a young E-5 in the Navy who has completed 2 deployments and just recently transferred to a new command with 6 years of service under my belt.  Now of course here's the reason I'm here, I bought a home in Va Beach, VA in july of 2007. That automatically disqualifies me from recieving HAP assistance...I called and asked. As many can attest I did not see the housing market decline coming when I bought my home. I actually bought it foreclosed with about 5 grand in positive equity between what I paid and what it appraised at. I figured I would break even if/when it came time for me to transfer. As I stated I recieved orders to a shore command and found out my house was worth about 40k less then what I owed...(I used an equity accelerator program to pay my loan off faster) I was deployed when I recieved my orders and my wife, who we found out was pregnant and due Oct. 24th (any day now), started the process to get our house on the market and sold. That's when we found out we were upside down and had to apply to proceed with a short sale or do a deed-in lieu (DIL). She had sent in all the paperwork to my mortgage company...National City Mortgage...and got the house on the market. Well she is a very trusting individual and never recorded names of anyone she spoke to over the phone and speaking with our "represenative" and I use that term lightly...informed us today that we were given false information and needed to start the whole process over again.

 

I'm going to start a new thought here and break up the length of writing. When I returned from support of OEF in July I had called to check on our staus and told everything was going great and to go ahead and default on my loan so we were eligible for the DIL. Now I am informed I am going into collections even after being told not to worry as it wouldn't proceed that far cause we had our hardship package in. There is no quarters to live in I would have to pay rent whether it was to a private landlord, or the "privatized" housing here on base so I could not afford to leave my wife and unborn child behind in VA and pay to live here alone. And I sure can't afford my mortgage payment and the rent here that consumes all my BAH. That was our hardship and exactly what the letter we sent indicated.

 

We had tried to submit an affidavit of truth (I think) from my last command stating that i was on deployment and PCS'ing when I returned but it was too "official" for the package and they had my wife send in a hand written letter. I don't understand this but looking back it seems they were taking advantage of myself and my wife. Now I am about 60 days from the Virginia cutoff to be foreclosed on and am going to lose the house...not a big deal to me I wanted to get rid of it, but I am scared of the implications. I know its a topic I read on here but I am afraid to lose my clearance and my job...I am a Navy Nuke...I am just scared I will not be able to provide for my family small growing family.

 

Any advice on protection I am warranted from the DOD or the likes would be apprecaited or any advice on what else I can do. Thank you for taking time to read this, I know my family is not the only one going through this and hope that anyone can shed some light so that we, or anyone else for that fact, can be led in the right direction.

 

Thank you,

Bobby (MM2 (SW))

Bobby -

Regarding your clearance, please be transparent and have an open line of communication with your chain of command. DONCAF is handling this case by case. If you scour the internet a bit, you'll find stories of people VERY high up the chain of command enduring foreclosure/short sale/DIL woes associated with the real estate market. The Navy can not afford to yank the clearance of stellar sailors and aircrew who, otherwise, have never had financial issues..

My husband has approx. 15 years of service and a TS+ clearance.
We transferred from Virginia 19 months ago.
You are correct, it is nearly impossible to attempt a balancing of a budget with the responsibility of two homes. We leased ours out at a loss of $1300/month and sustained as long as we could..
We now have drained our 401k TSP (and have to repay as it was a hardship withdraw), have no regular savings, and our credit cards are maxed out (currently under a debt management program - all accounts are closed). We also sold our 2nd car in the process (but just bought a new vehicle not too long ago foreseeing that we may have to destroy our credit we wanted to have at least one 'new' vehicle financed - husband just bought a cheapie commuter motorcycle to get back and forth to the base till he deploys again).

Here's how it's been for my husband with his entire chain of command Senior Chief to XO and CO. They have all extended support and are advocates to petition for retention of his clearance. His CO and XO both had difficulties with the sale of their own properties when they transferred to our new duty station. They've sent correspondence to DONCAF and the response is very positive that husband will be able to keep his clearance. There are no absolutes in this, but the point is that everyone understands the scenario..

Factoring into this: We have never paid any other bill 'late' or have had any collections. This house created the hardship and we have a defined timeline and documentation of our efforts to keep the home. It seems that you also have the same.

A scenario where DONCAF may take a clearance because of this:
A colleague of my husband's did not communicate with his command when he went through a short sale of a true investment property (the guy owns a few townhomes in VABEACH and also transferred down to where we are), as well he went to collections on other bills, and those creditors contacted the command. Because this guy choose to not communicate and let it get to that point, he was immediately denied his much needed TS clearance for his new rate and his secret has been pulled. The command *is trying to work with him, but their efforts are not as strong. This guy just went through 19 months of intensive training and his accomplishment to now work in this new field is done without a TS. That's the bottom line.

Hope the above sheds some light and gives you both some comfort, take care of your family.
And start with your LPO and Chief to garner support.. collect all of your documentation. When my husband went through the process of notifying his command, we also went through the Financial Officer, Navy Marine Relief Society, Navy Family Services, Navy Legal.. The concensus from all base professionals was 'you've got to get rid of this house one way or the other!'
Husband and Chief THEN took that concensus to the upper chain, along with more details which I provided.

Hope Joe or someone else can come along to help with your HAP concern.

Well I took the advice of many and let my COC know today about the housing problem and like weneedpeace said I will be going to see the financial officer and the likes starting monday. I also have an appointment with a Navy lawyer. I am just floored to think that a business with a computer system that monitors my files, payments, etc. has no record of when I call to talk about my loan or whom I talked to...like they don't have to log on a computer and access the account? Right now I know its going to be a he said she said dilemma even if I had names it would turn in to that I'm sure. I just can't believe I was told to default on the loan because it was required to do the DIL and now that I'm in essence 3 months behind (5k) with penalties and such I'm told I shouldn't have done that and foreclosure is almost unavoidable.

Hopefully if it makes it that far I can subpoena recorded conversations or something to prove what I was told to do by the "experts" at my mortgage company.

One other question...since foreclosure and bankruptcy are about the same hit on the credit...I think...which would be the lesser of two evils if given the choice? Everyone has their own opinions and I'm just trying to get all the facts so that if in the event things go the wrong way I can make an informed decision.

Bobby

Bobby,

 

So glad to hear that you've spoken with your COC.  Yes, Navy Legal is the first step.  I also suggest that you pay (if they don't offer free consultations) a Virginia real estate lawyer and obtain some specific advise, as my encounter with Navy Legal in our state - obviously, he does not specialize in Virginia law or Real Estate law. 

Regarding the conversations that you had that your lender is now stating is not 'documented'.. here's a tip, when I contacted a non for profit (HOPE NOW), while consulting with me, their computer system logged in with Wells Fargo.  The counselor actually was able to read notes that the Loss Mitigation.  As well, when I contacted my rep at the VA loan center, they were able to confirm that nothing in their system was showing that Wells Fargo had sent our file to the foreclosure department.  So, you may be able to do a little digging to find out what exactly is documented and especially if you have a VA loan explain your scenario to the rep, as I know MINE is keeping her own notes with our 'communication discrepancies'

 

.. I've also been told the same as you, a conflict of 'pay, don't pay'.. in fact, this past week I've received a certified letter stating, 'Pay $5,000 by end of October or we'll accelerate the loan', then yesterday (10/3) received a letter dated the 27th that stated 'you must pay $5,000 by 10/2) .. Received the day AFTER their supposed 'due date' This is a matter of their purposefully confusing to the borrower, so there's no way of unraveling what exactly needs to be done to either secure a loan modification, process a short sale - whatever end result the borrower is trying to achieve.  Yet, give the appearances of their following any mandated laws or regulations set in place because of their receipt of stimulus money..Our home IS going into foreclosure and every letter that they mail me just reaffirms that decision that we need to move on.

Please post updates, if you can, after you talk with Navy Legal or if you find out any additional information.

Good Luck!

Bobby, First thanks for serving.   I applaud your savy in buying a home.  In years past, it would have been an excellent move for a young Sailor that would have led to excellent growth of wealth.  As you noted, almost no one saw the depth of the market correction and recession that we have experienced.  Hindsight is 20/20. 

It is my "opinion" based on many years of service and 4 times in command that getting the COC informed and involved is a prudent step.  I must add the caveat that we don't know what, if any DOD guidance has been issued that may tie the command's hands on how they deal with this.  Nor can anyone know how an individual commander may choose to deal with these issues.  So we unfortunately give you absolute advice on this issue. 

While the anecdotal stories on this site are helpful, please understand that we don't know have all the answers on this.  

When we get more info on how DOD decides to move ahead with this tsnami of similar issues, we will post.  Please stay tuned and let us know how things go.  I would also encourage you to call Dave Bryan, Helping Hand Foundation.  He is more than willing to discuss your situation with you and has done very well for our clients.   Just go to the main forum page, scroll down to find his forum and contact info.  

Joe Gladden 

Bobby,
I spoke to Joe Gladden about your post and have reviewed it. I am happy to assist you if you would like to call me. I am the founder of the Helping Hand Foundation and have advised more than 100 families that are in the same situation as you. Also, I have had dealings with Nat. City. If you would like to call me my number is 540-341-7543, or you can review my post on the VR SAM website which has a link to my website where you can submit a request for information.