President Barack Obama aimed his 2012 mortgage relief programs at members of the military as well as civilian homeowners, with government-insured loans to address the overall housing crisis.
Before they were famous, many truly influential men and women started by serving their country in the US military or grew up in military families.

President Obama's Mortgage Relief Helps Military Homeowners

President Barack Obama aimed his 2012 mortgage relief programs at members of the military as well as civilian homeowners, with government-insured loans to address the overall housing crisis.

President Obama allowed borrowers with mortgages insured by the Federal Housing Administration to refinance at lower rates, saving the average homeowner more than $1,000 a year.

And specifically for military service members, President Obama made an agreement with major lenders to compensate service members and veterans who were wrongfully foreclosed upon or denied lower interest rates, thereby violating their Service members Civil Relief Act rights.


Under Obama's housing plan, FHA-insured borrowers would be able to refinance their loans at half the fee FHA currently charges. FHA borrowers who want to refinance now must pay a fee of 1.15 percent of their balance every year. Officials say those fees make refinancing unappealing to many borrowers. The Obama housing plan will reduce that charge to 0.55 percent.

In 2012, with mortgage rates at about 4 percent, the administration estimated that a typical FHA borrower with $175,000 still owed on a home could reduce monthly payments to $915 a month and save $100 a month more than the borrower would have under current FHA fees.


By 2012, more than 20,000 service members had lost their homes to foreclosure. Many of them were foreclosed in direct violation of the Service members Civil Relief Act which protects active duty service members against foreclosure.

For service members and veterans, Obama announced that major lenders will continue to review foreclosures, to determine whether these foreclosures were indeed done improperly and illegally.

For example, you may have been told that you don't qualify for a loan modification or even a short sale unless you're delinquent on your mortgage payments.

But you are also told to do all you can to remain current on your mortgage. And even if you are delinquent, there's no guarantee that the bank will modify your mortgage rather than foreclose.
And, under the rules of the SCRA, no service member on active duty can be foreclosed upon without proper notice, which often happens while being unavailable on active duty.

If wrongly foreclosed upon, President Obama proposed that service members and veterans be paid any lost equity and also be entitled to an additional $116,785 in compensation. That was a figure reached through an agreement with major lenders by the federal government and 49 state attorneys general.

Under the agreement, the lenders also would compensate service members who lost value in their homes when they were forced to sell due to a military reassignment.


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