Compliance for Banks & Lenders

The Servicemembers Civil Relief Act (“SCRA”) is designed to protect Servicemembers from issues related to obligations undertaken before military service. Other Blog sections outline those protections.

If a servicemember incurs obligations before entering active military duty, most protections of the SCRA may be invoked by a simple written communication from the servicemember to the lender, landlord, or other business entity with whom the servicemember has a contract. The notice must be sent no later than 180 days after the termination of military service. The notice must include a copy of the military orders calling the servicemember to military service.

President Trump is loosening restrictions on protections for servicemembers, according to a recent NPR story. The changes, if enacted, will come via the Military Lending Act rules. This law, similar to the Servicemembers Civil Relief Act, provides protection to servicemembers on active duty. Specifically, the MLA lays out rules for lending to servicemembers. The proposed…

The SCRA and foreclosure efforts are closely intertwined.  prohibits foreclosures on any deployed servicemember (and, under their dependents if they seek court relief) while the servicemember is deployed and for up to a year after they return. The Servicemembers Civil Relief Act protects servicemembers from concerns at home like paying bills while they are off…

SCRA protections are not to be taken lightly. Violating the Servicemembers Civil Relief Act carries serious penalties. But so few of lenders’ clients are servicemembers — is the risk really that high? Think of the attention lenders must pay to these laws like insurance. Policyholders’ homes rarely burn down. Car accidents are infrequent. Is going…