Understanding SCRA: A Comprehensive Guide to the Servicemembers Civil Relief Act

An important piece of legislation, the Servicemembers Civil Relief Act (SCRA), provides financial protection, legal aid, and other similar services to qualifying military personnel and others. The Act aims to safeguard military personnel from legal or financial issues back home, ensuring their service during a military engagement remains unhindered. The protections outlined in this law help Servicemembers to defer certain legal and financial obligations while in uniformed service, allowing them to devote their entire energy to the mission and the defense of the country. The Act suspends these concerns, postponing any penalties for late payments or similar consequences. This is incredibly important to the military’s stability, as the Department of Defense has known for quite some time that Servicemembers are only at their best when they have a positive work-life balance and are not mentally encumbered by worries facing their families or other civilian issues back home.

Eligibility for SCRA Benefits

SCRA Military benefits are indeed quite important to helping the Servicemember stay focused while deployed, but in order to qualify for the provisions of the law, the Servicemember must meet several eligibility requirements. The following personnel qualify for protections under the Act:

• Any active duty commissioned officers
• Members of the reserve forces are currently on active duty
• Active duty members of the Army, Marine Corps, Navy, Air Force, and Coast Guard
• Any member of the National Guard mobilized under federal orders for more than 30 consecutive days
• Anyone holding valid power of attorney for the Servicemember, including some protections towards dependents

Key Benefits of the Servicemembers Civil Relief Act

The law outlines several provisions intended to protect Veterans and Servicemembers from financial and civil issues while serving in the military. The law describes five specific protections that apply to those who qualify.

Reducing to a maximum of 6% any interest rates on loans taken out prior to service

If a Servicemember incurred any debt, such as a credit card debt, automobile or home loan, or student loan, prior to enlisting, or what is known as a pre-service obligation, then the Servicemember is entitled to have the interest rate reduced to a maximum of 6% per year. To do this, you must submit in writing to your lender a copy of your orders to active duty, along with a letter from your commanding officer indicating the date you began active service. The lender then has up to 30 days to reduce your rate to 6% or less, which remains in place anytime you are active duty, up to 180 days after release of active duty. The law does not penalize your account or deny you credit for exercising your Servicemembers Civil Relief Act benefits during this time. This also cannot count against your overall credit score.

Protections against default judgments in civil cases

The Act provides certain benefits and legal protections against lawsuits while on active duty and many have questions about how they can benefit. The Act allows for a deferment for a certain amount of time if you received a default judgment in a civil action where you were unable to defend yourself due to deployment. If you were also serving in active duty and were not able to appear in a case against you, then the court cannot issue a default judgment without an attorney appointed to represent you.

Protections against Home foreclosure

If you took out a mortgage before entering active service, you cannot face foreclosure. While you are on active duty and for at least one year after leaving active duty, you have protections under the Service Member Relief Act against foreclosure. The court may request a Servicemember in foreclosure or adjust the loan, assuming the Servicemember has the ability to pay the loan but is unable to do so due to active duty.

Protection against property repossession

The SCRA prohibits creditors and lenders from repossessing personal property, such as your vehicle, without a court order. If you failed to make your payments or violate the contract due to active duty or deployment, the creditor must get an order from the court before repossessing the property. However, you must satisfy the following conditions:

• The property was purchased or leased before entering active duty
• A deposit or installment payment was made on the property before entering active duty

Termination of automobile and residential housing leases without penalty

If a lease is terminated as a result of deployment, the Servicemember can claim benefits. If a Servicemember must break a lease due to deployment, the Servicemembers Civil Relief Act provides protections allowing for the right to terminate these leases without a negative impact on a credit score or contract penalties. To begin the process, you must submit a written notice of termination and copies of orders to your landlord or loan officer.

How to Claim SCRA Benefits

Claiming your benefits under the SCRA can be both simple and complicated, depending on which benefit you are trying to claim. The following steps are important when claiming your benefits.

1. Complete the Service Member Civil Relief Act Benefits Request Form.
2. Email the request form, along with any supporting documents (usually a letter from your commanding officer and your active duty orders), to scra@hesaa.org.
3. You can also mail the form to PO Box 544, Trenton, New Jersey, 08625-0544.
4. You can fax the benefit request form to 609-588-7285.
5. Submit your request for SCRA Military benefits in writing to your lender or landlord, along with copies of your enlistment and active duty forms, as well as a letter from your commanding officer. Not all lenders require the letter from your CO, but it is beneficial to have anyway.
6. Follow the instructions for uploading any other documentation needed at the SCRA website.

Additional Resources and Support for SCRA

If you have further questions regarding your benefits, there are many resources to assist you. If you are on active deployment, speak with the resources officer at your military installation or similar support offices. Your local VA counselor or a VA regional loan center can also assist you with the application process and answer your questions. You can read more at scra.mil or call 877–8 27–3702. For a comprehensive overview of the SCRA, click here to access the user guide, which answers several questions on the Service Member Relief Act.

Frequently Asked Questions About SCRA