If you are a member of the United States Armed Forces and have outstanding debt, the Servicemember’s Civil Relief Act (SCRA) provides you with certain protections against your creditors.

Servicemember’s Civil Relief Act (SCRA)

The SCRA was signed into federal law by President Bush on 19 December 2003.  It is a complete revision of the Soldiers’ and Sailors’ Civil Relief Act (SSCRA) of 1940. The purpose of the SCRA is to expand protections for servicemembers against civil actions while on certain duty assignments. Congress’ primary intent in passing this federal statute is to allow servicemembers to fully commit their attention to fighting the Nation’s wars without having to worry about problems that might arise at home.

To qualify for the protections afforded under the SCRA, the servicemember must be on Active Duty. Reservists and National Guard members fall under the SCRA if they have orders placing them on Active Duty. The protections of the SCRA begin on the date of entering Active Duty. However, the protections generally terminates within 30 to 90 days after the date of discharge from duty.

Some of the primary protections provided by the SCRA include:

1)      A cap of 6% on interest rates for all pre-service loans and obligations. This applies to loans such as credit card debt, cash advances, and service charges. Student loans that the federal government guarantees also fall under this protection.

2)      A delay of bankruptcy proceedings by a servicemember debtor. Additionally, Creditors are cannot seek judgments against the servicemember. The SCRA places a stay on Civil actions for a period 90 days or longer at the court’s discretion. There is also a stay on getting judgments, garnishments, and bank levies.

3)      In cases of foreclosures, lenders must obtain a court order before they can foreclose on a servicemember’s home.  This requirement applies to all states. It even apples to states that require a court order.

4)      In cases of bank account levies and wage garnishments, the servicemember may request that the Court temporarily stop or suspend the taking of money or property.

5)      For civil cases against a servicemember during a period of active duty military service or within 90 days thereafter, the servicemember may request a stay of civil action for a period of at least 90 days.  If the judge denies such a request, the court is must to appoint an attorney to represent the servicemember.

If you are a servicemember debtor and feel that you are entitled to the protections provided under the SCRA, please contact our office for a free consultation to discuss your situation further.