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

[Alberta Bound]

PP05

Excellent, great to hear.

AB

 

[Pusser]

I'm glad you are choosing to use your "windfall" posting allowance for an investment or mortgage opportunity.
This allowance is not intended for the use you chose to use it for. The posting allowance is to cover expenses experienced not covered by standard IRP policy. 

Not correct.  You can use it for that purpose, should you so chose, but that was never the intent.  Posting Allowance pre-dates the IRP by several years and its stated purpose upon inception was to compensate members for the turmoil associated with a move.  The old CFAO on the subject actually said that.  What you actually do with your Posting Allowance is entirely up to you.  It has not other stated purpose.  The Movement Grant, however, was originally intended to pay for the little things that it wasn't worth accounting for in the pre-IRP days.  With IRP, they lumped them together into the Personalized Envelope for administration, but the intent remains the same.

 

[dapaterson]

Of course, the question remains why a month's pay is needed.  Wouldn't a flat rate make more sense?

 

[heavy reader]

Brauer angry!

 

[McG]

It looks like the government is on the offensive to ensure military families eat the costs of home losses.

Feds try to quash class action lawsuit by veterans who lost money when they moved
Alison Auld, The Canadian Press
CTV News
07 May 2015

The federal government has filed a motion to strike down a proposed class action lawsuit by a 33-year veteran of the Armed Forces who lost $72,000 on the sale of his house when he was posted to another base.

Documents filed in Federal Court indicate the Justice Department wants the matter thrown out before it is certified, arguing it is destined to fail, amounts to a criticism of government policy and is better suited to a judicial review.

"It challenges an economic policy decision of government to limit the amount of reimbursement paid to members who sell their private homes at a loss," states the 24-page memorandum filed last month.

"Such a policy decision cannot ground a lawsuit....

"The claim has no reasonable prospect of success and should be struck."

A hearing date has not been set for the matter.

The original suit was filed in September 2014 by master warrant officer Neil Dodsworth, who took a loss on the sale of his home near Edmonton when he was posted to Kingston, Ont., in 2009.

A member can receive 100 per cent compensation of their loss through the home-equity assistance program if they sell their home in a housing market that is deemed by the Treasury Board to be depressed.

But the board disputes what is constitutes a depressed market in Canada. Dodsworth says it also lumps smaller communities into larger centres, like Edmonton, where the housing market is not considered to be depressed.

Dodsworth filed for compensation for the entire amount that he lost, but was told he would only receive $15,000 since his home in Morinville, about 35 kilometres outside Edmonton, was not in a depressed market.

The policy states that a depressed market is one that has seen real estate values drop by 20 per cent or more. Dodsworth argued that the value of his home went down 29 per cent over two years.

He says in the statement that he lost all the equity in his home, took out a $21,000 bank loan to cover part of his mortgage and volunteered for a seven-month tour in Afghanistan to earn more money.

Heather Domereckyj, a spokeswoman for the Treasury Board, said in an email that she could not comment since the matter is before the courts.

Dan Wallace, Dodsworth's lawyer, said his client was dismayed with the motion to dismiss the case.

"He's disappointed," Wallace said Thursday. "I told him when we started that this could be expected. He knew this was going to take a long time."

The case is similar to another one involving Maj. Marcus Brauer, who received $15,000 for a $88,000 loss he took on the sale of his house in Alberta.

Brauer launched a judicial review, which led a Federal Court judge to order the Treasury Board to review its decision.

http://www.ctvnews.ca/politics/feds-try-to-quash-class-action-lawsuit-by-veterans-who-lost-money-when-they-moved-1.2363838

... and in a separate, related note:

Military member loses bid to recover losses linked to sale of home
Alison Auld, The Canadian Press
CTV News
08 May 2015


HALIFAX -- The Treasury Board has rejected the latest effort by a 24-year veteran of the Canadian military who has fought for years to recover $88,000 he lost on the sale of his home when he was ordered to relocate to another base.

Maj. Marcus Brauer said Friday that the board has reviewed his housing claims and found the market in Alberta where he was living was not depressed at the time, effectively quashing his appeal for full compensation of his loss.

The letter from an official says the board determined Bon Accord was not a depressed housing market in 2010 when Brauer sold his home to relocate to Halifax. As a result, it says Brauer is not entitled to more than the $15,000 he received for the loss.

"It just demonstrates how unjust this system is," Brauer said.

"I'm not about to let this go. There has to be some accountability in this government. ... This is not justifiable."

Brauer, a father of five, said he plans to sue the federal government over what he says is a responsibility to follow its own policies and compensate members who suffer losses.

Heather Domereckyj, a spokeswoman for the board, says in an email that the second review of the Bon Accord market "was conducted in an independent, impartial manner by the department and relied on the advice of third-party experts in its conclusion."

New Democrat MP Robert Chisholm, who represents the Halifax-area riding where Brauer lives, said he is disappointed with the decision.

"I can't believe the lengths the government will go to to fight against and frustrate and work against Canadian Forces men and women," he said.

"This has not only financial implications, but also emotional and career ramifications for Marcus."

This latest decision comes almost a year after a Federal Court judge in Halifax ordered the Treasury Board to review its initial decision in 2012 not to grant Brauer full compensation for the loss.

Judge Richard Mosley quashed the Treasury Board's decision and sent the case back to the board for review. He also awarded Brauer his legal costs.

Mosley said in his ruling that the board's decision was "unreasonable" and "not justified."

Brauer's lawyer Daniel Wallace argued that housing prices in Bon Accord dropped 23 per cent over the three years he lived there, which is three percentage points above the 20 per cent threshold for a depressed market in the military's policy.

He also said Bon Accord, which has its own mayor and boundaries, should not be lumped in with Edmonton. The board disagreed, arguing the municipality was part of the Edmonton market where housing prices had dropped just 2.9 per cent.

Ottawa spent almost $65,000 fighting the case, including $25,376 on Brauer's legal fees and disbursements, $33,270 for the federal government's legal fees and almost $6,000 for a third party review of the housing market.

Another Canadian Forces member has launched a proposed class-action lawsuit against the federal government to fight for compensation for housing losses.

Neil Dodsworth, the plaintiff, lost $72,000 on the sale of his house Edmonton when he was posted to Kingston, Ont., in 2009. Ottawa has filed a motion to strike down the matter.

http://www.ctvnews.ca/canada/military-member-loses-bid-to-recover-losses-linked-to-sale-of-home-1.2365808

 

[Scoobie Newbie]

Great way to keep your work force happy.

 

[heavy reader]

The report used by TBS contains significant errors. I have brought them up to the CoC, so that DCBA can work with TBS to resolve them. However, the clock is ticking. Decision was made on 7 May, which gives me 30 days to get a positive reponse from TBS, or carry on with an action in Federal Court.

I really feel for the guys at TBS, if they had done good staff work, this would have never happened.

Onward...

 

[RADOPSIGOPACCISOP]

Most of these problems can be solved by just not buying a house.

If your concerns are regard to the large losses that occur with the ebb and flow of the real estate market then the simple solution is to not put so much of your networth into one investment category (ie Real Estate) and rent instead.

I'm flabbergasted at how the prevailing thought is to buy a house at all costs, even when obviously better solutions are out there. Places like Victoria where it's $450,000 minimum to buy a down in the dumps townhouse that you can rent for $1,400. Or $200,000 to buy a 3 bedroom house when you can get a 3 bedroom PMQ for $500.

Lets be real, yes the 2000s were amazing for home prices (I too made more equity gains than my salary some years), but we're being willfully blind if we think the gravy train is going to continue forever. People need to stop with the home buying assumption and actually look at the dollars and sense of it all. The money saved by renting is often far better to be invested in a diversified TFSA/RRSP than to dump it into a house. Couple that with the amount you save from property tax, repairs and maintenance, insurances and even moving costs (since DND is not covering mortgage breakage fees. When you sell your $450k dumpy townhouse in Victoria and move to Gagetown you are going to break that mortgage or end up buying a mansion to avoid breakage fees).

While it's true the military moves us and should shoulder the burden, it's also rings true that there is a certain truth to the idea that we can't just continually pocket the gains of our good real estate decisions and expect DND to pick up the tab on our bad choices.

/side rant

I honestly thing the CF would solve a lot of it's own personnel problems if it incorporated some personal financial management courses in the recruit training. HighSchools aren't doing it, so they show up at our door with no idea how to handle money and then we push what they think is a big wad of cash at them. It's a recipe for disaster. I think I've seen more financial problems from people a year off tour then someone who never went. A lot of it stems from soldiers not getting any more info on personal finance than what they hear from peers in just as dire straights as they are.

/end rant

 

[Sf2]

500 bucks for a 3 bedroom? Do tell....

 

[Scoobie Newbie]

IF you can get a Q as well

 

[RADOPSIGOPACCISOP]

500 bucks for a 3 bedroom? Do tell....

Fact.

 

[Scoobie Newbie]

Where

 

[Sf2]

Convincing post is convincing.

 

[blacktriangle]

I will admit that buying can be risky in the military (especially for single folks, or those on a single income) - but kiss a big chunk of your pension bye-bye if you choose to rent indefinitely.

 

[Tibbson]

My family and I have given up more then enough over the length of my career.  I don't think we should be expected to give up home ownership as well.

 

[Ostrozac]

500 bucks for a 3 bedroom? Do tell....

A quick google shows that my old 3-Bedroom Q in Gagetown is still right around $500. It was a good deal then, it's a good deal now.

http://www.cfha-alfc.forces.gc.ca/hl-el/gagetowngi-gagetownig-eng.aspx

Three (3) Bedrooms
Shelter Charge Sq. Ft. No. of Units Type No. of Storeys No. of Bathrms Click Style for Details and Photos
$467 - $538 948 - 1074 387                 Row 2                 1                 M/131

 

[Gunner98]

I honestly thing the CF would solve a lot of it's own personnel problems if it incorporated some personal financial management courses in the recruit training. HighSchools aren't doing it, so they show up at our door with no idea how to handle money and then we push what they think is a big wad of cash at them. It's a recipe for disaster. I think I've seen more financial problems from people a year off tour then someone who never went. A lot of it stems from soldiers not getting any more info on personal finance than what they hear from peers in just as dire straights as they are.

/end rant

In the 1990s until 1994 anyways Recruit Training included an afternoon session on financial management and budgeting.  The military used to train officers and Warrant Officers as Unit Financial Counsellors. 

The real issue is that the soldiers of today, especially those who go on tour have more money than the soldier of the 1990s.  SSIP is one option as they have financial advisors.  The CAF formed a partnership with the Bank of Montreal to provide another option http://www.bmo.com/cdcb/ - so getting help is as easy as clicking on a link on a website. 

 

[blacktriangle]

A quick google shows that my old 3-Bedroom Q in Gagetown is still right around $500. It was a good deal then, it's a good deal now.

http://www.cfha-alfc.forces.gc.ca/hl-el/gagetowngi-gagetownig-eng.aspx

Three (3) Bedrooms
Shelter Charge Sq. Ft. No. of Units Type No. of Storeys No. of Bathrms Click Style for Details and Photos
$467 - $538 948 - 1074 387                 Row 2                 1                 M/131

Sadly Gagetown does not reflect the reality for every base. That area has beautiful homes on multi-acre lots selling for less than a new condo in the NCR.

 

[kratz]

Fact.

PAY my $938 month RSU rate in Borden....fact  :evil:BTW...that was in 2011.

Do NOT...assert fact, unless you are experienced, or can back up your "facts"

Your experience will not speak for the entire CAF

 

[TCM621]

Fact.

10 years ago, I rented a 3 bedroom hald duplex (the floor plan with the tiny kitchen) for 860, in victoria. I currently pay 912 for a 3 bedroom Q in Comox. There is no way you can rent a 3 bedroom in Victoria for 500. 500 might, might, get you a bacherlor apartment in Victoria. Average rent for a 3 bedroom in Victoria is 1317 as of 2014.

https://www03.cmhc-schl.gc.ca/hmip-pimh/en/Profile/DetailsPrimaryRentalMarket?geographyId=2440&t=3