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Protecting Those Who Protect Us: 6 Facts About the Servicemembers Civil Relief Act

If you are an active-duty member of the U.S. military, you are entitled to certain rights and protections under the Servicemembers Civil Relief Act (SCRA). The Act reduces the financial and legal burdens of servicemembers during periods of active duty and deployment so that they can dedicate their energy to serving the defense needs of the United States. Certain provisions are also extended to military spouses and other dependents.

Below is a list of six facts about the Servicemembers Civil Relief Act, all of which illustrate ways that the Act protects active-duty military personnel as consumers:

  1. Military members may terminate automobile leases early without penalty.

    Servicemembers who entered an automobile lease before being called to active duty and who are called to serve for at least 180 days may, with proper notice and return of the car within 15 days to the lessor, terminate the lease without an early termination charge. Servicemembers who sign an automobile lease while on active duty and who then receive a permanent change of station outside the U.S. or who are deployed for at least 180 days in support of a military operation may similarly terminate automobile leases.

  2. Creditors may not repossess personal property without a court order.

    If a member of the military bought or leased property (such as a motor vehicle) and made a deposit or payment on the property before being called to active duty, creditors seeking to repossess the asset must obtain a court order first.

  3. Military personnel and their dependents can only be evicted via court order.

    If a service person rents their home and the rent is below a certain amount (the threshold changes yearly), the landlord cannot evict them or their dependents or subject the premises to distress during periods of active duty without first obtaining a court order. If the order is granted, the service person can ask for a 90-day stay of the eviction, subject to the discretion of the court.

  4. Property leases may be terminated without penalty.

    Military personnel can terminate without penalty any business or residential property leases they signed before going on active duty with proper notice. They can terminate a lease signed during active duty if their permanent duty station changes or if a new deployment will last longer than 90 days.

  5. Interest on existing loans and obligations must be capped at 6%.

    This cap, which takes effect when a service member is on active duty, applies to credit cards, mortgages, car loans, some installment loans, and even certain student loans. All interest above 6% is forgiven during the period of active duty and cannot accumulate or become payable after service ends. To qualify, the service member must have incurred the debt prior to active duty, be unable to pay the full interest rate due to their military service, and properly notify the creditor.

  6. Credit rating protection.

    Lenders cannot refuse or revoke credit, change the terms of an existing loan, or create a negative credit report because a service member claims SCRA protections.

When U.S. servicemen and women go on active duty, they deserve to rest assured that they are protected from financial penalties, repossessions, and court judgements due to their military service. Attorney Bryce Bell at Bell Law is committed to upholding the rights of military consumers throughout Missouri and will take all necessary steps to seek damages for any SCRA violations.To schedule a case review, contact Bell Law today.

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