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House OKs longer foreclosure protection

The Neighborhood Stabilization Act approved Thursday by the House of Representatives includes language giving service members one year of protection from foreclosure after release from active duty.

Because the financial protection applies to homes purchased before beginning active duty, the change to the Servicemembers’ Civil Relief Act, which now provides only 90 days of post-duty protection, would apply mostly to National Guard and reserve members mobilized in support of contingency operations.

“For many of our returning service members and veterans, the stress of deployment is still prevalent when they return home,” said Rep. Bob Filner, D-Calif., the House Veterans’ Affairs Committee chairman who sponsored the foreclosure provision.

A year of protection against foreclosure, sale or seizure of property provides “not only the necessary time to readjust, but will also ensure they have the opportunity to do this in the comfort and security of their own home,” he said.

He said a year would give time “to catch up on payments, make alternative arrangements with a lender, or in the worst-case scenario, sell their home.”

The housing bill containing the provision, HR 5818, passed the House by a 239-188 vote, but faces an uncertain fate. The White House has issued a veto threat for the larger bill because administration officials fear that provisions involving government bailouts of foreclosed homes might encourage more lenders to foreclose.

On Wednesday, Senate Veterans’ Affairs Committee members Sens. Bob Casey, D-Pa., and Johnny Isakson, R-Ga., introduced the Disabled Veterans Homeownership Preservation Act, which would extend foreclosure protection to disabled veterans who have filed for, but are not yet receiving, disability benefits.

“While foreclosures are on the rise all across this country, this housing crisis has been especially hard on our injured veterans returning from war,” according to a statement from Casey. “Our veterans deserve to have a policy in place to protect them from losing their homes while waiting to hear back on their claims.”