SCRA Navy Federal: A Quick Guide

Active duty Armed Forces members are granted legal and financial protections, but did you know that the Navy Federal offers better interest rates? People who render military service must understand their rights. That’s why we’re exploring this topic further in this article.

The Servicemembers Civil Relief Act: A Summary

Servicemembers Civil Relief Act

Before anything else, let’s explore the Servicemembers Civil Relief Act (SCRA). This federal law grants financial and legal protections to active-duty service members.

Air Force, Army, National Guard, Marine Corps, Space Force, and Navy members can request SCRA protections if they’re on active duty. Commissioned officers in Public Health Service offices are also granted protection.

The SCRA provides various protections, including an interest rate reduction in consumer debt and mortgages entered into before entering active duty service, the power to delay court and administrative proceedings, termination of leases without paying extra fines, termination of consumer contracts, protection from eviction, state tax clarification, portability of professional licenses, and default judgment protection.

Interested parties must obtain a court order to take action while respecting SCRA protection. Active duty service members must submit a written request and written notice if they have a permanent change in station.

Service members may opt to waive or cancel their SCRA rights. However, this waiver must be in written format and signed by the person during or after the active duty period. If the waiver was signed before that person entered military service, it will not be valid.

What Makes the Navy Federal Special?

Effective April 1, 2022, the Navy Federal offers a lower maximum interest rate of 4% to eligible member accounts. This rate is two percent lower than the standard federal interest rate reduction of 6%. As with the federal interest rate reduction, the debt or mortgage must have been taken out before that person entered into active duty service.

Is My Account Eligible for SCRA?

Before an active duty member requests an interest rate reduction, they must determine if the account is eligible for SCRA protections. Here are the types of debt that the SCRA covers:

  • Business loans
  • Checking lines of credit
  • Consumer loans
  • Credit card debts
  • Mortgage
  • Student loans

How Active Duty Members Request for SCRA Protections?

SCRA Protections for military members

Active duty service members who intend to request SCRA protection, such as interest rate reduction, should follow proper protocol to ensure they receive their benefits.

Here’s a quick guide to help service members maximize their SCRA rights properly:

  1. Gather all documents. The most crucial part of this step is obtaining a copy of the active-duty orders from the military. This may be requested from one’s military branch office.
  2. Contact the affected institution or person. The service member should submit a written notice to the person or institution required to honor that person’s rights and explain the SCRA benefit they intend to use. Each institution may have a preference for how to receive these messages in writing, and the letter must be sent to the correct location. Service members shouldn’t use a phone call as sufficient notice because they must submit the request in writing to submit it formally.
  3. Provide evidence of active duty. In addition to the letter stating which SCRA benefits they wish to activate, the military member must provide proof of their active-duty status. The easiest method is for the military member to obtain a copy of active-duty orders from the federal organization or military branch they served with. If this isn’t possible, a letter from the commanding officer may also be provided. This letter must state when the service member began active duty.
  4. Ask for the benefit to be honored. To ensure the benefit is honored, it is important to clarify the SCRA benefit being requested. If the service member intends to activate several benefits from different institutions, they should prepare separate requests to be sent to every company or person.


Service members on active duty should maximize their rights and make use of SCRA benefits. That’s why they should stay updated on the latest news about the SCRA.

As for lenders, they should be vigilant and verify if the person they’re dealing with is indeed rendering active duty service. This is where SCRACVS can be of service. Our military verification service allows businesses to verify a person’s active duty status.


What is the SCRA in banking?

SCRA is short for the Servicemembers Civil Relief Act. This is a federal law that can affect bank interest rates.

How does the SCRA work?

SCRA benefits only apply to service members on active duty. Service members must proactively request SCRA protection and specify which benefit they want to be honored. Everything must be documented for legal purposes.

What is SCRA status?

SCRA status refers to a person’s active duty status. This federal law covers only active duty service members.

What is the Navy Federal rate? 

The Navy Federal offers a 4% interest rate reduction, while federal law stipulates a 6% interest reduction.

Does SCRA apply to Navy Federal Credit Union?

Yes, the SCRA applies to the Navy Federal Credit Union. The Navy Federal offers preferential rates to eligible accounts.

What qualifies for SCRA relief?

Relief would depend on the SCRA protection that the service member would like to activate. In cases of interest rate reduction, this only applies to debt before one enters active duty.

What is the SCRA 6 interest rate rule?

Once a service member enters active duty, they can have interest rate rates on debt incurred before they entered into active duty reduced to a maximum of 6%.

Do you get money back from SCRA?

A service member would only get money back if they are eligible for a refund because of SCRA protections.

Attorney Roy Kaufmann serves as the Director of the Servicemembers Civil Relief Act Centralized Verification Service, located in Washington, D.C. As a recognized authority on the Servicemembers Civil Relief Act, Mr. Kaufmann has published hundreds of articles and hosted many webinars. His teachings help law firms and businesses to remain compliant with the SCRA rules and regulations so as to avoid costly fines.