The Soldiers’ and Sailors’ Civil Relief Act of 1940, now commonly known as Service members Civil Relief Act (SCRA) of 2003 provides rights and protections, often in the form of military interest rate reduction, to military personnel in active duty.
This act’s major benefit is the ability to reduce mortgage interest rates and consumer debt interest rates (including debts incurred jointly with a spouse) to a 6% limit given a certain circumstances. This takes some burden off military personnel as they struggle to pay their mortgage while serving the country.
Certain conditions apply to this act, however. For example, the mortgage or debt must have been incurred before his entry into active military service. Just as well, the military service member must show that his military service has or can have a “material effect” on the legal or financial matter involved.
This act basically is for those actively serving military personnel including: Army, Navy, Marine Corps, Air Force, Coast Guard, and National Oceanic and Atmospheric Administration. This act may also help reservists who have been ordered to report for military service as well as persons who are ordered to report for induction under the Military Selective Service Act and guardsmen called to active service for more than 30 consecutive days. In select situations, dependents of service members may also be entitled to certain protections.
The mortgage interest limit rate is not considered automatic. To request for a military interest rate reduction, you must submit a written request to your mortgage lender and attach a copy of your military orders. The request may be submitted as soon as the said orders are issued but the copy must be provided to your mortgage lender not later than 180 days after the date of your release from active duty military service. When you contact your mortgage lender, the following information should be provided:
* An attached notice that you have been called to active duty;
* A copy of the orders from the military notifying you of your activation;
* If applicable, your FHA case number is also needed;
* An evidence that a debt precedes your activation date.
For further contexts about SCRA’s military interest rate reduction, you may seek professional assistance via the contact page.
