What rights do I have under the Servicemembers Civil Relief Act while I'm on active duty?

What the Servicemembers Civil Relief Act Covers#

The Servicemembers Civil Relief Act of 2003, formerly known as the Soldiers’ and Sailors’ Civil Relief Act of 1940, is a federal law that grants all military members additional rights as they enter active duty.

The Servicemembers Civil Relief Act covers a variety of issues, including rental agreements, security deposits, pre-paid rent, eviction, installment contracts, credit card interest rates, mortgage interest rates, mortgage foreclosure, civil judicial proceedings, and income tax payments. It protects active duty military members and reservists or members of the National Guard called to active duty (starting on the date active duty orders are received) and, in limited situations, dependents of military members (for example, certain eviction actions).

Lowering Interest Rates on Pre-Service Debt#

The Servicemembers Civil Relief Act allows pre-service consumer debt and mortgage interest rates to be reduced to 6 percent under certain circumstances. To get this reduction, the servicemember should send the lender or creditor a written request along with a copy of the mobilization orders.

How the Six Percent Rule Works

To receive protection under some parts of the Servicemembers Civil Relief Act, the member must be prepared to show that military service has had a material effect on the legal or financial matter involved, for example by earning less money on active duty than before. The servicemember should inform the lender in writing with a copy of the orders to active duty attached, and request immediate confirmation that the interest rate has been lowered to 6 percent under the SCRA. The lender must adjust the interest down to 6 percent unless it goes to court. In court, the lender, not the servicemember, would have to prove that the servicemember’s ability to pay has not been materially affected by military service.

For example, on a car loan financed at 9 percent before active duty, the 3 percent difference is forgiven or excused, and the servicemember need not pay that amount. The servicemember does need to continue making the monthly payments of principal and interest (at 6 percent) to avoid the account being considered delinquent. Continuing payments should also avoid any adverse credit reports. (See Section 207, SCRA.)

The 6 percent limit does not apply to debt taken on after entering active duty. In some situations, civilian employers have agreed to pay the military member the difference between the military pay and the civilian pay earned before the call to active duty. In most such situations, military service has not materially affected the member’s ability to pay, so it is unlikely that the 6 percent limit applies, unless the member’s expenses increased, for example by having to pay for a second apartment at the duty station.

Postponing Court and Administrative Proceedings#

The Servicemembers Civil Relief Act permits active duty servicemembers who are unable to appear in a court or administrative proceeding due to military duties to postpone the proceeding for a mandatory minimum of 90 days upon request.

The request must be in writing and explain why the current military duty materially affects the servicemember’s ability to appear, provide a date when the servicemember can appear, and include a letter from the commander stating that the servicemember’s duties preclude his or her appearance and that he or she is not authorized leave at the time of the hearing. This letter or request to the court will not constitute a legal appearance in court. Further delays may be granted at the discretion of the court, and if the court denies additional delays, an attorney must be appointed to represent the servicemember. (See Section 202, SCRA.)

Protection From Eviction#

Under Section 301 of the Servicemembers Civil Relief Act, a landlord must obtain a court order before evicting a military member or the member’s dependents.

Eviction for Nonpayment of Rent

Although the Servicemembers Civil Relief Act does not excuse servicemembers from paying rent, it does afford some relief if military service makes payment difficult. The court must find the member’s failure to pay is not materially affected by his or her military service. Material effect is present where the servicemember does not earn sufficient income to pay the rent. Where the member is materially affected by military service, the court may stay the eviction (for three months, unless the court decides on a shorter or longer period in the interest of justice) when the military member or dependents request it. There is no requirement that the lease be entered into before entry on active duty.

This protection applies when the landlord is attempting eviction during a period in which the servicemember is in military service or after receipt of orders to report to duty, the rented premises is used for housing by the spouse, children, or other dependents of the servicemember, and the agreed rent does not exceed a monthly limit, an amount that is subject to change. Servicemembers threatened with eviction for failure to pay rent should see a legal assistance attorney.

Ending a Lease After Orders#

The Servicemembers Civil Relief Act allows active duty servicemembers who receive permanent change of station orders or deployment orders for a period of 90 days or more to terminate their leases.

The Servicemembers Civil Relief Act also includes automobiles leased for personal or business use by servicemembers and their dependents. A pre-service automobile lease may be cancelled if the servicemember receives active duty orders for a period of 180 days or more. An automobile lease entered into while the servicemember is on active duty may be terminated if the servicemember receives PCS orders to a location outside the continental United States, or deployment orders for a period of 180 days or more. (See Section 305, SCRA.)

Reopening a Default Judgment#

Under the Servicemembers Civil Relief Act, a default judgment entered against a servicemember during active duty service or within 60 days thereafter can be reopened and set aside by the servicemember.

In order to set aside a default judgment, the servicemember must show that he or she was prejudiced by not being able to appear in person, and that he or she has good and legal defenses to the claims against him or her. The servicemember must apply to the court for relief within 90 days of the termination or release from military service. (See Section 201, SCRA.)

Life Insurance Protection#

The Servicemembers Civil Relief Act permits the servicemember to request deferment of certain commercial life insurance premiums and other payments for the period of military service and two years thereafter. If the Department of Veteran Affairs approves the request, the United States will guarantee the payments, the policy shall continue in effect, and the servicemember will have two years after the period of military service to repay all premiums and interest. The amount of insurance this program will cover is the greater of $250,000.00 or the maximum limit of the Servicemembers Group Life Insurance. (See Section 401, SCRA.)

State Taxation Clarification#

A nonresident servicemember’s military income and personal property are not subject to state taxation if the servicemember is present in the state only due to military orders. The state is also prohibited from using the military pay of these nonresident servicemembers to increase the state income tax of the spouse. (See Section 511, SCRA.)

Health Insurance Reinstatement#

The Servicemembers Civil Relief Act provides for the reinstatement of any health insurance upon termination or release from service. The insurance must have been in effect before such service commenced and terminated during the period of military service. The reinstatement is not subject to exclusions or a waiting period if the medical condition in question arose before or during the period of service, the exclusion or waiting period did not apply during coverage, and the medical condition has not been determined to be a disability incurred or aggravated by military service. This protection does not apply to a servicemember entitled to participate in employer-offered insurance. The servicemember must apply for reinstatement within 120 days after termination or release from military service, in writing to the insurance company with a copy of the orders for active duty and release from active duty. (See Section 704, SCRA.)

SCRA Protections at a Glance#

Deadlines to Request Protection#

Protection under the Servicemembers Civil Relief Act must be requested during the member’s military duty or within 30 to 180 days after military service ends, depending on the protection being requested. These protections do not apply automatically, and the deadline depends on which right the servicemember is asking to use.

Legal Advice Available#

If you think that you have rights under the Servicemembers Civil Relief Act that may have been violated, or that you are entitled to be shielded from a legal proceeding or financial obligation by its protections, you should discuss the matter with a legal assistance attorney or a civilian lawyer as soon as possible.

What to Do Next#

To use these Servicemembers Civil Relief Act protections, gather a copy of the military orders and send a written request to the lender, landlord, or court as needed. Act while still on active duty or within the 30 to 180 day window after service ends, since the exact deadline depends on which protection is being requested.