Considering Eglin AFB HAP PCS to Avoid Short Sale or Foreclosure? 3 Options Available

Real Estate Broker/Owner with Rulnick Realty, Inc.

Eglin HAP agent 


HAP is the Homeowners Assistance Program that helps Eglin Air Force Base or Hurlburt Field airmen PCSing to new bases who have upside-down equity in their homes.  That is, their mortgage balances are more than the fair market values of their properties. HAP helps those military members who are ordered to transfer to new bases avoid foreclosure, short sale and VA Compromise Sale by paying off the mortgage balance not covered by the sales proceeds due to declining market values.  If you qualify for HAP, there are three main programs for assistance:  Government Acquisition (GA), Government Assisted Private Sale (GAPS), and Private Sale (PS).  


In this article, we’ll example the Government Assisted Private Sale (formerly called Private Sale Augmentation).  Will it work for you? Let’s see…. 


GAPS is a more complicated HAP program, but you could end up putting dollars in your pocket if the calculations work in your favor. To figure out how much of your mortgage and closing costs it will cover, HAP calculates  90% of your prior fair market value (your purchase price plus costs of improvements), adds about 7% for closing costs, then subtracts out your new purchase price and mortgage payoff, plus any buyer credits and actual closing costs.  If you have put enough improvements into your home, or the purchase price is high enough, or your mortgage payoff low enough, that's where this program makes sense - your mortgage and closing costs will be covered and you get money back at closing. Let's look at an example.


For our example, let’s start with these numbers.


Original Purchase Price             $300,000

Improvements                             $20,000

Total Prior Fair Market Value    $320,000 (PFMV)

PFMV $320,000 x 90% =              $288,000 (HAP benefit)

Sale Price                                    $200,000

HAP Closing Cost Estimate       $14,000 (sale price x 7%)

Outstanding Mortgage               $250,000

Seller Subsidy,Closing Costs    $7000

Now, to put our calculations together….

Property Benefit = .90 X 320,000(PFMV) = 288,000 - 200,000 (sale price)  = $88,000 (property benefit)


Estimated HAP Benefit = 88,000 + 14,000 (est closing costs)  = 102,000
Cash to Closing = (200,000 purchase price  + 102,000 = 302,000) - (250,000 mortgage balance  + 7,000 seller subsidy = 257,000) = 45,000
SELLER GETS $45,000 Back at closing!


HAP Eglin PCSHow would the GAPS HAP Program not work for the Eglin AFB Service Member? Let’s alter the numbers, and pretend the outstanding mortgage balance were higher, let’s say $285,000, and the sale price lower, like $180,000, and all the other numbers were the same.


In that case:

Cash to Closing = (180,000 purchase price  + 102,000 = 282,000) – (285,000 mortgage balance  +7,000) = 292,000) =  -10,000 Uh Oh!! Seller would have to bring $10,000 to closing!  This GAPS program would not work to the benefit of the Eglin or Hurlburt airman.


What’s the alternative? Use the standard HAP Government Acquisition (GA) program.  In the GA program, HAP will simply pay off the mortgage balance at closing, plus 3% buyer credit of allowable closing costs.  There would be a closing first between the U.S. and the service member, then a same-day closing between the U.S. and the buyer the service member found through his Realtor who specializes in HAP.


There are more detailed criteria that apply to each HAP scenario.  If you are PCSing, need to sell, and want to avoid foreclosure, short sale or VA Compromise Sale, HAP may be your best option.  Questions?  Give me a call.

It's Wendy!

Wendy Rulnick, Broker, Rulnick Realty, Inc.

Call toll-free 1-877-487-9639 or local 850-650-7883 ext 204

Email Wendy:

Eglin AFB Short Sales & Pre Foreclosure Help.

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Wendy is a short sale and pre-foreclosure specialist and has been featured in "Kiplinger Personal Finance Magazine" and "Florida Realtor Magazine". Call Wendy Rulnick, Broker/Owner, to list and sell your home or condo on the Emerald Coast of Florida in Walton, Okaloosa and Santa Rosa County-  Destin, Santa Rosa Beach, Fort Walton Beach, Niceville, Bluewater Bay, Navarre, Seagrove Beach, Watercolor, Sandestin, Seaside, Crestview, Rosemary Beach, Mary Esther, Shalimar, Eglin AFB, Hurlburt Field. 


Comments (3)

Melissa Zavala
Broadpoint Properties - Escondido, CA
Broker, Escondido Real Estate, San Diego County

I've had a few people talk to me about these, but I have never had to do one. I already know who I'm calling if a HAP comes my way (hope you answer).

Jun 15, 2011 02:29 AM
Wendy Rulnick
Rulnick Realty, Inc. - Destin, FL
"It's Wendy... It's Sold!"

Melissa - It seems they change the HAP rules and guidelines as they go along.  I try to keep up, and I'd be happy to take your call!

Jun 15, 2011 12:41 PM
Tamara Inzunza
Realty One Group Capital - Alexandria, VA
Close-In Alexandria and Arlington Living

Hi Wendy! Thanks for the great explanation about the HAP program.  We have several HAP sales in my area, and I'm also working with a lot of military owners.

Jun 16, 2011 01:12 AM