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Debt Help for Active Duty Military

Active duty service members, including reservists and the National Guard, may qualify for additional debt help under a law that was updated in 2004. The Soldiers and Sailors Civil Relief Act of 1940 was amended by the Servicemembers Civil Relief Act of 2004 (SCRA) to protect service members from financial and legal problems.  SCRA may help you or someone you know, who has been called to active duty in the military, with rent, mortgage or credit card difficulties. Below are some examples of the protections the law provides.

Reduced interest rates on mortgage payments and credit card debt: Under the SCRA, a service member may request an interest cap of 6 percent on credit cards, mortgages, car loans and other debts (excluding student loans) for the duration of active service. The act applies to all debts incurred before active duty. It is important to note that service members must submit a request for rate reduction; it will not happen automatically. Evidence that military obligations have materially affected the applicant’s ability to fulfill financial obligations must be provided. This can include proof of movement to active duty and documentation of the difference in military and civilian pay.  It is recommended that you contact your lender in writing to notify them of your situation and to request the 6 percent cap.

Protection from eviction if your rent is $2,721 or less: The SCRA provides protection for dependants should they face eviction while a service member is on active duty. The act only applies if rent is $2,721 or less. If eviction does occur, courts may grant an extended period of stay provided there is evidence that a service member’s duties have affected their ability to pay rent in a timely manner. This is typically granted for three months or however long the judge determines is appropriate. Service members may also terminate a lease that was signed before active duty. Members must provide written notice of lease termination to the landlord after beginning active duty or receiving orders for active duty.

Delay of all civil court actions, such as bankruptcy, foreclosure or divorce proceedings: The SCRA allows service members to request a minimum 90-day stay or postponement of civil proceedings if military responsibilities prevent proper representation in court. The provision only applies to civil lawsuits, paternity suits, child custody suits, and bankruptcy debtor/creditor meetings.

We hope this information is helpful to you or someone you know who has been called into active service.  To learn more about these benefits as well as other debt and housing solutions contact us or visit our website.

This article is a brief summary of several provisions covered by the Servicemembers Civil Relief Act of 2004 and is not meant for the purpose of legal advice. Please contact your unit’s legal assistance office for more information or visit

Published May 18, 2009.