The Mercenary’s Cookbook

We’ve heard a lot about the housing bubble, and how it’s dragging down an already slowing economy. What you probably didn’t know - or rather, you did, but most anybody else doesn’t - is that foreclosures have hit military towns the hardest:

In the midst of the worst surge in mortgage defaults in seven decades, foreclosures in U.S. towns where soldiers live are increasing at a pace almost four times the national average, according to data compiled by research firm RealtyTrac Inc. in Irvine, California. As military families like the VerSteeghs signed up for the initial lower rates and easier terms of subprime mortgages, the number of people taking out Veterans Administration loans fell to the lowest in at least 12 years.

“We’ve never faced a situation like this, not in the Vietnam War, World War II, or the Korean War, where so many military are in danger of losing their homes,” said Paul Sullivan, executive director of Veterans for Common Sense, a Washington-based advocacy group started in 2002 by Iraq and Afghanistan War veterans. “No one asked them for their credit score when we asked them to fight for us.”

Foreclosures in towns around military bases, including Norfolk, Virginia, have increased 217 percent in the first quarter compared to last year because military families, who are often on the move, were an easy target of the predatory subprime lending. So families can find their loved ones being sent on extended tours, only to return to bankruptcy or homelessness.

Fortunately, the bipartisan Casey-Isakson Bill is being floated to give military families some breathing room: 

This legislation would specifically amend the Servicemembers Civil Relief law in the following ways:

 

1. For all servicemembers who incur a serious illness or injury during their military service, the foreclosure grace period provided in current law would be extended from 90 days to one year.
2. A servicemember who, within one year after completing their military service, files a claim with the Secretary of Veterans Affairs shall be protected from foreclosure throughout the application process and until 30 days after their claim is adjudicated.
3. “Serious injury or illness” is defined as rendering the servicemember medically unfit to perform the duties of their rank.

Another bill that would seem to be a no-brainer is the one floated by former Assistant to the Reagan’s Secretary of Defense and current Democratic Senator Jim Webb to extend educational benefits for our returning veterans who have already gone way beyond what anyone could have reasonably expected in the call of duty. Seeing an obvious opportunity in an election year, the Bill has already gotten the support of Presidential hopefuls Barack Obama and Hillary Clinton, and Senator John Warner (R-VA). Who would oppose such a thing? Remarkably, the greatest remaining Iraq War hawks, George Bush and John McCain. (McCain managed not to be present for the final vote). The reasoning being that too much generosity might harm retention if soldiers have something to look forward to when they move on to civilian life.

Seen in the same light, I suppose foreclosure can be a net positive as well. It’s hard to leave when you’re guaranteed to have a tarp over your head.