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:: Soldiers' and Sailors' Civil Relief Act
If you're a reserve component service member called to active duty, you're protected by a law
that can save you some legal problems and possibly some money as well.
Under the provisions of the Soldiers' and Sailors' Civil Relief Act of 1940, you may qualify for
any or all of the following:
- Reduced interest rate on mortgage payments.
- Reduced interest rate on credit card debt.
- Protection from eviction if your rent is $1,200 or less.
- Delay of all civil court actions, such as bankruptcy, foreclosure or divorce proceedings.
"Although all service members receive some protections under the SSCRA, additional protections are
available to reserve components called to active duty," said Lt. Col. Patrick Lindemann,
deputy director for legal policy in the Office of the Undersecretary of Defense for
Personnel and Readiness. Most active duty service members are familiar with the
provisions of the SSCRA that guarantee service members the right to vote in the
state of their home of record and protect them from paying taxes in two different states.
One of the most significant provisions under the act limits the amount of interest that may be
collected on debts of persons in military service to 6 percent per year during the period of
military service. This provision applies to all debts incurred prior to the commencement of
active duty and includes interest on credit card debt, mortgages, car loans and other debts.
The provision, Lindemann emphasized, applies to pre-service debts, and the interest rate
reduction doesn't occur automatically — service members must request it.
Material Affect
Once a service member requests the rate reduction, the creditor must either comply or
apply for court relief. The SSCRA puts the burden on the creditor to show that military
service has not "materially affected" a member's ability to repay the debt. The court generally
grants relief if the creditor can make his case.
Lindemann advised that service members notify lenders of their intent to invoke the 6 percent
cap in writing, along with proof of mobilization/activation to active duty and evidence of the
difference in the member's military and civilian pay. This could prevent creditors from attempting
to challenge interest rate reduction requests in court.
The interest rate cap does not apply to federal guaranteed student loans. However, according
to Lindemann, the Department of Education has in the past deferred or suspended payments on
student loans for reserve component military members called to active duty. Service members
should contact their lenders or schools to determine if such a program has been implemented
and its eligibility requirements.
Civil Proceedings
Another key provision under the SSCRA protects your dependents from being evicted while you are
serving your country. If you rent a house or apartment that is occupied for dwelling purposes
and the rent does not exceed $1,200 per month, the landlord must obtain a court order authorizing
eviction. This provision applies regardless of whether quarters were rented before or after entry
into military service.
In cases of eviction from dwelling quarters, courts may grant a stay of up to three months or
enter any other "order as may be just" if military service materially affects the service
member's ability to pay the rent. This provision is not intended to allow military members
to avoid paying rent, said Lindemann, but rather to protect families when they cannot pay
the rent because military service has affected their ability to do so.
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