Home Equity Assistance & "Military Families Pushed to Financial Ruin" (Merge)

[dapaterson]

And when you've got three kids, two dogs, and two cats and you're posted into a market where three bedroom units literally do not exist, you should just shove your family into a 2 bedroom apartment?

Don't be ridiculous.

Sell the kids to a rugmaker in India or Pakistan, then get a two bedroom apartment for you, your spouse, and the pets.

 

[kratz]

<snip>
So, two people get posted out of Halifax. One is going to Victoria, one is going to Ottawa. The guy going to Victoria will have a much, MUCH bigger custom envelope than the guy moving to Ottawa.

If both take a hit on the sale of their houses in Halifax, the guys getting posted to Victoria will have a greater well of funds with which to cover his losses.

It boils down to "life choices". Does someone rent or buy? If they rent, there might be access to PMQ / RHU at a posting. If those options meet the family's needs.

If you chose to buy, you are at the mercy of the market. When you join you should know what benefits you are agreeing to, offered by the employer.  Granted, over a 25 year career those options can change, but then a person has the option to retire.

 

[TCM621]

It boils down to "life choices". Does someone rent or buy? If they rent, there might be access to PMQ / RHU at a posting. If those options meet the family's needs.

If you chose to buy, you are at the mercy of the market. When you join you should know what benefits you are agreeing to, offered by the employer.  Granted, over a 25 year career those options can change, but then a person has the option to retire.

You at the mercy of the market to some degree. The HEA, is so that the CF can move a member when it needs to even if  a unexpected downturn would cause them a financial burden. It is actually in the best interests of the CAF.

For example,  let's examine the case of WO Bloggins. WO Bloggins has 23 years in and is on an IPS. He has recently been promoted and is now and AM Sup. He is a highly skilled and experienced AVN tech. 8 years ago he bought a house in Edmonton due to a lack of PMQs and the likelihood of a long posting. Unfortunately,  if WO Bloggins sells now he will be out 40k. The RCAF doesn't have a WO billet available in Edmonton, so he has to move. WO Bloggins is presented with 2 options move or get out. He has a life in Edmonton, a house he likes and that he knows will recover it's value in a few years.

The CF would lose 40k if it provided HEA. They would gain some good will towards a loyal and skilled Airman and keep his experience. If they don't give it,  they would lose the cost of replacing an experienced helicopter maintainer. They would literally gain nothing. The replacement cost would far out way the loss of HEA.

Of course is some cases the HEA would be higher relative to the replacement cost but in many cases it would be lower as well.  I am not sure what it cost to recruit and train a person up to a journeyman level(or higher) but I bet the HEA loss would have to be very high to offset it if someone quit over it.

 

[Gunner98]

Maybe the WO could rent out his Edmonton home (to an incoming soldier) for the same amount (or more than) it will cost him to rent a nice home in the new location; thereby saving everyone money and ensuring he has a home to move back to if he so wishes.

 

[Eye In The Sky]

IIRC, renting the house out means zero benefits later to the WO when it comes to selling, etc from IRP as it would become an 'income property'. 

 

[TCM621]

IIRC, renting the house out means zero benefits later to the WO when it comes to selling, etc from IRP as it would become an 'income property'.

Not to mention all the hassle which comes from renting out a property in another province.

 

[Pusser]

IIRC, renting the house out means zero benefits later to the WO when it comes to selling, etc from IRP as it would become an 'income property'.

That's not quite true.  If the member rents out his house he is entitled to the Real Estate Incentive (REI) to a maximum of $12,000 (taxable) and if he later re-occupies it (e.g. gets posted back) he would then be able to claim real estate and legal fees for a future sale (i.e. if posted again or for an IPR move on retirement).  He can also declare it as his "primary residence" for up to four years while it's rented out, so he won't have to pay any tax on any capital gain made during the period he's not living in it.

 

[QM]

Maybe the WO could rent out his Edmonton home (to an incoming soldier) for the same amount (or more than) it will cost him to rent a nice home in the new location; thereby saving everyone money and ensuring he has a home to move back to if he so wishes.

It's threading a needle in a haystack to find just the right renter who wants exactly what your house offers, at that exact location at that exact time at that right price. Even with people posted-in and posted-out of the same Base, it's unbelievably unlikely that lightening will strike. And it certainly won't strike the hundreds of times it would need to as hundreds of people get posted into and out of that Base.

 

[Nudibranch]

Not to mention all the hassle which comes from renting out a property in another province.

Rental management agencies. They take a cut to place a tenant and there's a (generally low) monthly fee.
Now, that option might be place-dependent. I imagine they'd exist in places like Edmonton, Victoria, Halifax...not sure about Cold Lake.

 

[TCM621]

Rental management agencies. They take a cut to place a tenant and there's a (generally low) monthly fee.
Now, that option might be place-dependent. I imagine they'd exist in places like Edmonton, Victoria, Halifax...not sure about Cold Lake.

That isn't really the point though. Yes renting is an option but even with am agency you have to deal with things that are happening in a different place and time Zone. If you move from Halifax to Victoria, your rental agency is probably closed by the time you get off work. A lot of people don't want to have to deal with that. And I don't remember seeing any rules stating that they have to.

We should not be forced into major financial difficulties in order to suit the CAF. If we want to keep the best people,  ie people who have skills and traits employers want, we need to be reasonable. We lose too many good people because we are too willing to tell people that if they don't like it,  release.

 

[Nudibranch]

That isn't really the point though. Yes renting is an option but even with am agency you have to deal with things that are happening in a different place and time Zone. If you move from Halifax to Victoria, your rental agency is probably closed by the time you get off work. A lot of people don't want to have to deal with that. And I don't remember seeing any rules stating that they have to.

We should not be forced into major financial difficulties in order to suit the CAF. If we want to keep the best people,  ie people who have skills and traits employers want, we need to be reasonable. We lose too many good people because we are too willing to tell people that if they don't like it,  release.

I'm not arguing your second para, just making a point that there is a way to be an out of province landlord (my rental management agency communicates with me via email - I have never had to deal with anything in urgent real-time. That's what they're paid to do, after all - manage on my behalf, inc undertake urgent repairs up to a certain ceiling).

 

[CountDC]

And when you've got three kids, two dogs, and two cats and you're posted into a market where three bedroom units literally do not exist, you should just shove your family into a 2 bedroom apartment?

Maybe if you are lucky.  Most places won't allow it as you have too many pets.  Try finding a place for a family of 6 and a dog. 

 

[c_canuk]

The real shocking thing is no one complains and tries to give money to the CF when their house investment goes up $40,000 but the second their investment drops by $30,000 it's the tax payer's job to cover their investment risk.

If you don't want to take the risk of losing money on a house purchase, rent. Otherwise you need to accept that it could go up or down and it's your gain or loss, not the CF's.

I'd like to address this red herring...

the value of a house, on average, appreciates over time. Generally after a 4 year posting you should expect to sell a 200K home for about 10-20 k more than you bought it. On average. This is called equity and it doesn't belong to the CF.

Because it is accepted that, on average, house values go up, the CF really doesn't get a claim on any equity.

On the other hand, the market is volatile, so in the moment the value may be quite a bit lower. Since the CF does not entertain waiting until the market is right to sell, they do have a claim on the loss.



Yeah I know some people who sold in Edmonton about a decade ago made out like bandits and when posted to Gagetown, Petawawa, etc drove up the markets to stupid amounts. I lost 30K because of the correction afterwards.

Now if the CAF wants to get away from that liability, then they need to either stop posting people or fix the PMQ situation and make them competitive, available, and well maintained.

My proof that they are not is this... I'm in Ottawa and it's cheaper for me to buy a bigger condo including fees and property taxes a 30 minute bus ride from NDHQ than it is to rent a smaller, not so well maintained PMQ in Uplands. That's broken.

 

[heavy reader]

ALCON:

I would like to thank everyone involved on this thread for providing input (both positive and critical) on the HEA issue over the past 6 years.

However, it is over.

Although we took the TBS to federal court which determined they were cheating HEA applicants http://canlii.ca/t/g77g4, they refused to pay out http://canlii.ca/t/gnfqd.

MWO (Ret) Neil Dodsworth https://ca.news.yahoo.com/soldier-neil-dodsworth-drops-home-093000110.html had also ceased the class action due to reasons beyond his control. I cannot thank Neil enough for his courage to take this on, when I faltered and needed to regroup. He is a real advocate for our troops and a good friend.

Further, my previous MP (Robert Chisholm) was sage guidance and extreme help during navigation through the governmental processes. I will be forever grateful for his support. 

I wish the HEA outcome was decided in favour of following the policy, and none of this was necessary however we all see things going wrong and do our best to never pass a fault.

There's not much more that can be said, except thank you all for trying to hold the government accountable to their own policies. Lets hope that someone with more fire in their belly can take this on and resolve it for future relocations, oh and by the way - here is how to fix it: https://healoss.files.wordpress.com/2016/03/hea-study.pdf.

UBIQUE!

 

[armyman7877]

I can relate to these families. We have found ourselves in a similar position this year. Dealing with Brookefield has been a nightmare and getting your money back is almost nill.

 

[armyman7877]

Hi all so the offer we had on or home fell through because they did not sell their home. Our agent wants us to drop another 10,000 for any hopes of selling. We are around 30,00 less then appraised value in May and around 14,00 less than we paid in 12. My question is how much does Brook field pay back and how long will it take to receive the money? We were told we did qualify.  If anyone knows the answers thanks.