VETERAN ALERT: Interest Rates Capped for Military Families
March 22, 2017
LITTLE ROCK – Our military men and women deserve our utmost respect, but there are bad actors who take advantage of military service members and their families, especially when it comes to lending money.
Creditors and lenders are already prohibited by law from taking advantage of active duty military members, but the Servicemembers Civil Relief Act (SCRA) is meant to provide additional safeguards while they navigate deployment, change of duty station orders or other unique circumstances military families face, especially related to buying or owning a home.
“Banks cannot charge more than 6 percent interest on mortgages for military families during service and up to one year after service ends,” said Arkansas Attorney General Leslie Rutledge. “This allows families to plan ahead and prevents creditors from selling, foreclosing or seizing an active duty service member’s mortgaged property during service.”
The SCRA also provides protection requiring a judge to stay mortgage proceedings if a service member shows that military service has affected his or her ability to comply with mortgage obligations.
Additionally, the 2012 National Mortgage Settlement requires five major mortgage servicers – Ally/GMAC, Bank of America, Citi, JPMorgan Chase and Wells Fargo – to notify service members who are 45 days delinquent on mortgage payments that they are entitled to SCRA protections and are eligible for financial counseling from Military OneSource and Armed Forces Legal Assistance.
Attorney General Rutledge released the following tips to help service members understand and use loan protections provided under the SCRA:
- Inform the mortgage company that you are seeking protection under SCRA.
- Provide the lender with written notice of military service.
- Send the lender a copy of the orders calling the service member to active duty.
- Research time constraints that could impact eligibility for some protections.
- Consult the nearest Armed Forces Legal Assistance Office with questions regarding qualifications for SCRA.
In 2015, Rutledge launched the first-ever Military and Veterans Initiative at the Attorney General’s office to assist active duty military service members, reservists, veterans and their families with consumer related issues, Veterans Treatment Courts and many other collaborative efforts.
Arkansas military service members, veterans and families can file consumer complaints with the Attorney General’s office on ArkansasAG.gov or by calling (800) 482-8982.
For more information and tips to avoid scams and other consumer related issues, contact the Arkansas Attorney General’s office at (800) 482-8982 or firstname.lastname@example.org or visit ArkansasAG.gov or facebook.com/AGLeslieRutledge.