The Servicemembers Civil Relief Act of 2003 (SCRA) provides members of the military with a lot of great protections while serving their country in a combat zone. The SCRA protects Servicemembers from high interest rates, eviction, foreclosures, bankruptcy, lawsuits, etc. when called to active duty. The law is especially helpful for Reserve and National Guard forces who may have taken a pay cut form their civilian jobs to defend the country.
While the law was especially designed for Reservists and National Guardsmen, I have seen many patriotic companies honor the spirit of the law for active duty members of the military too. And, these are the companies that should be lauded for their commitments to our military. The law states that interest rates on loans including mortgages and credit cards must be reduced to 6% annually while the Servicemembers are on active duty. The lowering of the rate only applies to debt incurred before starting active duty service.
Because of that wording, I had a Soldier in my unit who had a bill consolidation loan with high interest rate from GE Financial, now called Genworth Financial after GE sold its financial services unit. GE Financial refused to lower my Soldier’s interest rate to 6% because he has always been on active duty and the debts were incurred while working on active duty.
I tell you that story as a warning about the companies you do business with. Citibank is the polar opposite from GE financial. Citibank not only lowers interest rates, but they drop it all the way down to 0% while you are deployed. Companies like Citibank should be applauded for their commitment to Solders while GE Financial should be avoided like the plague.
If you are currently deployed and have not contacted your creditors, have no fear. You can fax or mail a copy of your deployment orders anytime and receive a credit for any interest over 6% that you may have overpaid. It is back dated to the day that you deployed which is stated on your deployment orders.
Even though the economy is in a downturn and financial companies and banks are struggling it is great t see companies like Citibank who are committed to our nation’s military.
If you have specific questions about the Servicemembers Civil Relief Act you should contact your Judge Advocate General’s (JAG) office or legal assistance represtative for help.