Servicemembers Civil Relief Act

SCRA benefits are rarely automatic. To secure your homeownership protections, you must take action:

1. Notify your lender or landlord: Provide a written notice of your intent to invoke your SCRA rights.

2. Provide Military Orders: You must include a copy of your active-duty orders or a letter from your commanding officer.

3. Timing: For the 6% interest rate cap, you must provide notice no later than 180 days after your service ends. The rate reduction is then applied retroactively to the date your active duty began.

Protection is generally reserved for those whose civilian lives are disrupted by federal military orders:

• Active-duty members of the Army, Navy, Air Force, Marine Corps, and Coast Guard.

• National Guard members called to active service for more than 30 consecutive days under federal (Title 32) orders.

• Commissioned officers of the Public Health Service and NOAA.

• Dependents of the above (for specific protections like eviction and lease termination).

Yes, the act provides a safety net for your personal and professional life:

• Life Insurance: The government protects your private life insurance coverage by preventing it from lapsing for non-payment of premiums during service.

• Professional Liability: For doctors, lawyers, or other professionals in the reserves, you can suspend your professional liability insurance while on duty and reinstate it without a price increase or penalty when you return.

The SCRA ensures that your civic rights and financial obligations are not compromised:

• Income Tax Deferment: If your ability to pay federal or state income tax is impaired by your service, you can defer payment until 180 days after your release from duty.

• Voting Rights: You maintain your legal residency for voting purposes in your “home” state, even if you are stationed in a different state or overseas for years.

If you are sued while on active duty and cannot appear in court, the SCRA prevents the plaintiff from winning by “default.” The court must appoint an attorney to represent your interests. Furthermore, you can request a 90-day stay of any civil court matter (such as a divorce or a personal injury lawsuit) if your military duties prevent you from participating in the legal process.

Yes. One of the most powerful features of the SCRA is the ability to break contracts when duty calls:

• Residential Leases: You can terminate a lease if you enter active duty or receive PCS (Permanent Change of Station) orders for 90 days or more.

• Auto Leases: You can terminate a vehicle lease for deployments of 180 days or more.

• Phone Service: You can terminate or suspend cellular and landline contracts without penalty if you are relocating to an area where the service is unavailable.

If you or your dependents occupy a primary residence and your military service affects your ability to pay rent, the SCRA provides eviction protection. If your monthly rent is below a certain threshold (which is adjusted annually for inflation), a landlord cannot evict you without a court order. The court has the authority to stay (postpone) the eviction for 90 days.

The SCRA offers two primary “shields” for homeownership:

• Interest Rate Caps: Any mortgage taken out before entering active duty is capped at a 6% interest rate. Any interest above 6% is permanently forgiven, not just deferred.

• Foreclosure Protection: A lender cannot foreclose on your home without a court order while you are on active duty and for one year after your service ends. This applies regardless of your ability to pay.

The spirit of the SCRA dates back to the American Civil War, but it was first formalized as the Soldiers’ and Sailors’ Civil Relief Act of 1918 during World War I. It was later expanded during World War II and eventually replaced by the modern Servicemembers Civil Relief Act in 2003. These updates were necessary to include National Guard and Reserve members and to reflect modern financial products like cell phone and auto leases.

The SCRA is a federal law that provides a wide range of protections for military members as they enter active duty. Its primary purpose is to allow servicemembers to focus on their mission by postponing or suspending certain civil obligations, such as mortgage payments, tax filings, and legal proceedings. It ensures that the “legal playing field” remains level while a person is unable to attend to their personal affairs due to military service.