Compliance for Banks & Lenders

By: Roy L. Kaufmann

What are Common Myths About The Servicemembers Civil Relief Act?

There are a number of pervasive myths regarding the Servicemembers Civil Relief Act. In order to ensure compliance with this important law, it is critical that those who work with servicemembers know the ins and outs of the SCRA.

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By: Roy L. Kaufmann

The SCRA and Bankruptcy: Does it Apply?

Without a doubt, the Servicemembers Civil Relief Act applies in bankruptcy cases. It provides protection to members of the military against the entry of default judgments and gives the court the ability to stay proceedings against military debtors. The language of the SCRA states that it is applicable in any action or proceeding commenced in any court. 50 U.S.C. app. §§ 521, 522 and 524. Therefore, absent contravening language with respect to bankruptcy proceedings, the SCRA applies to all actions or proceedings before a bankruptcy court.

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By: Roy L. Kaufmann

Auto Lending: Can I Repossess Servicemembers’ Vehicles?

The SCRA can potentially lead to large fines for auto lending and leasing companies, as evidenced by this notable case.

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By: Roy L. Kaufmann

Hole in SCRA Allows Lender to Prey on Servicemembers

The Servicemembers Civil Relief Act exists to protect military personnel, who are often among the most vulnerable to shady financial practices, from exploitation and unfair penalties resulting from their service.

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By: Roy L. Kaufmann

Court Changes SCRA Expectations for Lenders

The Servicemembers Civil Relief Act (“SCRA”) generally requires that, for a Servicemember to be protected by the provisions of the SCRA, the servicemember must affirmatively send a notice to lenders. A provision in the SCRA that shifts burden to the lender regarding notice does not exist. The SCRA, at 50 U.S.C. App. § 533, provides certain protections in the context of residential foreclosures. One of those protections is a usually a moratorium on foreclosures if the loan predates the Active Duty Start Date. The length of this foreclosure not only includes the period of active duty, but a period after the Active Duty End Date.

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By: Roy L. Kaufmann

What Do Proposed Changes to Forced Arbitration and the SCRA Mean to Lenders?

Congress recently announced plans to re-introduce a bill to ban the use of forced arbitration in cases involving the Servicemembers Civil Relief Act. This move may prove to have a serious impact on lenders. The bill, known as the Justice...

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By: Roy L. Kaufmann

Lender to Pay Fine for SCRA Violation

Lenders and car dealerships beware when repossessing cars. California Auto Finance agreed to pay $80,000 in a settlement with the Department of Justice. This is the company’s second fine for an SCRA violation. The DOJ filed suit against California Auto...

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By: Roy L. Kaufmann

Lender to Pay $9M for Student Loan SCRA Violations

A federal student loan servicer has agreed to pay $9 million to settle a fraud claim with the New York Attorney General’s office for Student Loan SCRA Violations that deceived borrowers with student loans. The student loan debt crises has...

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