What do you do if you receive the call stating your unit, Battalion or Brigade is getting activated? Aside from putting all your personal affairs in order, check into the Servicemembers Civil Relief Act.
The Servicemember’s Civil Relief Act (SCRA) expanded and improved the former Soldiers’ and Sailors’ Civil Relief Act (SSCRA). The SCRA provides a wide range of protections for individuals called to active duty and applies to deployed service members as well. It is intended to postpone or suspend certain civil obligations to enable service members to devote full attention to duty and relieve stress on the family members of those deployed service members. A few examples of such obligations you may be protected against are:
– Outstanding credit card debt
– Mortgage payments
– Pending trials
– Terminations of lease.
In addition, the new law expands the current law that protects service members and their families from eviction from housing while on active duty due to nonpayment of rents that are $1,200 per month or less. Under the new provisions, this protection would be significantly updated to meet today’s higher cost of living, covering housing leases up to $2,932.31 per month, and then be adjusted annually to account for inflation.
Have high-interest credit cards? The SCRA clarifies and restates existing law that limits to 6 percent interest on credit obligations incurred prior to military service or activation, including credit card debt, for active duty service members. The SCRA unambiguously states that no interest above 6 percent can accrue for credit obligations (that were established prior to active duty or activation) while on active duty, nor can that excess interest become due once the service member leaves active duty. The portion above 6 percent is permanently forgiven. Furthermore, the monthly payment must be reduced by the amount of interest saved during the covered period. Note: This law only covers debt incurred prior to military service.
The SCRA also updates life insurance protections provided to activated Guard and reserve members by increasing from $10,000 to $250,000 the maximum policy coverage that the federal government will protect from default for nonpayment while on active duty.
In addition, it prevents service members from a form of double taxation that can occur when they have a spouse who works and is taxed in a state other than the state in which they maintain their permanent legal residence. SCRA will prevent states from using the income earned by a service member in determining the spouse’s tax rate when they do not maintain their permanent legal residence in that state.
So who is eligible?
The SCRA covers all Active Duty service members, Reservists and members of the National Guard while on active duty. The protection begins on the date of entering active duty and generally terminates within 30 to 90 days after the date of discharge from active duty.
To learn more, check out the FAQs.
Michael Schindler, Navy veteran, and president of Edmonds-based Operation Military Family, is a guest writer for several national publications, author of the book “Operation Military Family” and “The Military Wire” blog. He is also a popular keynote and workshop speaker who reaches thousands of service members and their families every year through workshops and seminars that include “How to Battle-Ready Your Relationship” or “What Your Mother-in-Law Didn’t Tell You.” He received the 2010 Outstanding Patriotic Service Award from the Washington State Department of Veterans Affairs.