HOW THE SERVICE MEMBERS CIVIL RELIEF ACT PROTECTS OUR MILITARY

This article will provide guidance on How the Service Members Civil Relief Act protects our military.  The United States Armed Forces are one of the largest in the world in terms of personnel. As such, in the face of a stressful work life, the Armed Forces service members are guaranteed certain safeguards. 

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If legal or financial activities negatively impact a service member’s rights while in uniform, they are granted legal and economic protections by the Service Members Civil Relief Act (SCRA). The Service Members’ Civil Relief Act (SCRA) postpones or suspends certain civil obligations to enable service members to relieve stress on their families and focus on their duties. 

Background

Congress enacted the Soldiers’ and Sailors’ Civil Relief Act (SSCRA) in the early years of World War II to ensure the safety of those enlisted in the military services.  On December 19, 2003, the SCRA was passed into law. It provides protection not just to active duty personnel but also to Reservists and National Guard troops. 

The goals of the SCRA are twofold being [A.] to allow service members (SMs) to focus solely on the nation’s defense needs, and [B.]  to temporarily halt administrative and judicial actions that could hurt service members’ civil rights while they are serving their country. Anyone who is a spouse or child of a service member is considered a covered person under specific provisions of the SCRA. 

Any federal, state, or political subdivision court or administrative agency is included under 50 U.S.C. § 3911(5). The provisions of the law strictly do not apply to criminal procedures. The court must consider a party’s military status when seeking a judgment, order, or adverse verdict against a party that has not appeared. According to the SCRA, the DOD must provide a statement about military service upon request from any party or the court. According to the SCRA, the Defense Manpower Data Centre (DMDC) is the DOD entity responsible for maintaining records about a person’s military status. Click here for information on How Rush Process Service Can Expedite Your Case.

Who Does The SCRA Apply To?

No matter what branch of the military a service member is presently serving in—Army, Navy, Air Force, Marines, or Coast Guard—the SCRA provides safeguards to you. It now includes active-duty reservists, National Guard troops serving more than thirty days on federal duty, and military personnel out due to illness or leave. In some cases, such as when a service member’s dependents co-sign a loan, the service member’s children and other dependents are also provided protection. 

Congress assigned the Government Accountability Office (GAO), a watchdog agency, the task of investigating whether or not service members are aware of their legal rights and what occurs when they consent to waive those rights. According to the GAO’s interviews with over a dozen officials from relevant agencies, including the DOJ, the CFPB, defense, justice groups, and service member advocacy groups, many service members need clarification about what rights they are giving up when signing waivers. 

To bring awareness of the rights and protections afforded to the nation’s defenders has thus become an important part of the SCRA. Servicemembers should contact the local office of the U.S. Armed Forces Legal Assistance program if their rights under the SCRA have been infringed. The Department of Justice may review the complaint if a military legal assistant cannot resolve the matter. Furthermore, military members are provided with training materials about their SCRA rights by the CFPB’s Office of Service member Affairs.

The  United States Attorney General may seek compensation for harmed service members by suing any person or organization found guilty of violating the Service Members Civil Relief Act (SCRA). 

Protection No. 1: Capping of Interest Rates 

The SCRA caps Interest Rates on Pre-Service Loans at 6%. If a military member took out a loan for a vehicle, house, education, or credit card before they were a service member (a ‘pre-service obligation’), or if they took a loan jointly, then the service member can get their interest rate lowered to a maximum of 6% per year. The bank must be intimated with a letter that includes any relevant documentation, such as orders to active duty or a letter from the commanding officer confirming the service start date. A private process service agency like Undisputed Legal should be involved in delivering these papers. We at Undisputed Legal understand the importance of the SCRA and ensure that your papers are served to provide you with the most entire benefits under the SCRA. For bank documents or financial papers of equivalent weight and importance, a private process server like those at Undisputed Legal can assure you of the speed and reliability of service.

The reduced rate applies to most loans while the service member is on active duty. However, the reduced rate for mortgages lasts another year after leaving active duty. It should be noted that once a service member is out of the military, their lender is barred from reapplying interest rates higher than 6% to the loan. Any time while active service and up to a hundred and eighty days following discharge, a service member has the right to ask your lender to lower your interest rate.

After using your SCRA rights, a lender cannot do anything to your loan or credit account, including cancel it, alter its conditions, or refuse to provide you credit. Further, just by using your SCRA rights, a lender cannot report you negatively. 

Protection No. 2: Prohibition of Default Judgements 

Certain legal safeguards are provided for servicemembers under the SCRA if they are sued while actively serving their country. Among them are safeguards against civil actions’ default judgments. 

So, what does a default judgment entail? If the defendant in a court case does not show up for their scheduled court appearance or does not reply to a court summons, the case will proceed to a default judgment. By default, the court may side with the plaintiff in such a case. However, servicemembers are exempt from default judgments under the SCRA.

Suppose the party suing the service member wants the court to impose a default judgment. In that case, they must submit an affidavit confirming their military status and providing evidence to support their claim. The affidavit must specify that the military member is on active duty if the person suing cannot ascertain otherwise. The court will not impose a default judgment against a party if they are an active duty military member who has not appeared in a matter until it has appointed a counsel to defend them. If certain requirements are satisfied, the court must additionally grant a ninety-day stay of proceedings.

The affidavit must be filed in time to prevent the default judgment and incorporate the service member’s military status. Undisputed Legal, as a private process service agency, understands the importance of timely service and can ensure that your military affidavit is delivered to prevent negative action against the service member. Since many military members are often unaware of the protections under the SCRA, we at Undisputed Legal consider it paramount to vouchsafe a military member’s safeguards against default judgments. As such, we serve your papers quickly to prevent any negative action against you.

Protection No. 3: Prevention of Foreclosures

A service member cannot have their property foreclosed upon if they took out a mortgage before entering active duty military without a waiver of rights. This benefit is in effect throughout their active service period and continues for an extra year after they leave the military. Parties are still protected from foreclosure in states that do not need a court order, and it doesn’t matter whether they informed their lender or servicer about your military status.

If a service member’s capacity to repay the loan is significantly impacted by their active duty service, the court may, or must, halt or suspend the foreclosure process or modify the loan under this SCRA protection.

Safeguards Against Property Repossession

A service member’s car and other personal possessions may be protected from creditors under the SCRA in certain situations requiring a court order to repossess. So, even if the party has broken the contract by not paying their monthly installments, the creditor still has to acquire a judge’s ruling before the cane member takes the service car or other possessions.

Just so you know, a member who doesn’t pay these payments may violate your contract, even if the SCRA protects against repossession without a court order. Consequently, there may be consequences for this inability to pay, including a late fee. The missed payments may also be recorded to credit reporting bureaus, and the creditor might attempt to recover the amount.

Protection No. 4: Penalty-Free Ending of Leases on Residential Property and Automobiles

Rent on residential property that a servicemember or their dependents are occupying or planning to occupy may be terminated by the servicemember by the SCRA. Any housing contract they may have signed before entering active duty, or any active duty service member who receives deployment orders for a minimum of ninety days or a Permanent Change of Station (PCS), should allow a member to cancel their lease without penalty.

A written notice of termination and supporting documents can be submitted to the landlord.  A private process service agency like Undisputed Legal can ensure that service is completed by private carrier, regular postal mail with return receipt requested, electronic means (i.e., e-mail, communications portal designated by lender or agent), or by hand delivery. We do not provide incomplete or assailable service: any documentation we undertake is accompanied by a copy of your orders or a letter from your commanding officer. As such, any service of your papers breaking the lease will be completely covered under the SCRA. 

If a lease calls for monthly payments, a servicemember may end it thirty days after the first of the months following the next rental payment date, regardless of when they received the notification to do so. 

Protection No. 5: Rental and Eviction Protections

As a military member, there are situations in which a servicemember cannot be forcibly removed from their residence. A court order is required before a landlord may remove a tenant or their family if the monthly rent does not exceed $9,106.46 in 2023. The service member may have leased the property before military service, but this clause will still apply.

If the court determines that the military duty poses a financial hardship, it has the authority to postpone the eviction for three months or more. This provision relieves families whose members cannot pay rent due to financial hardships caused by military duty.

If a servicemember fails to pay the monthly fee at a self-storage facility, the owner has the right to sell your belongings after giving you notice. The amount of time they have to either collect rent or sell these belongings is determined by state law. Nevertheless, according to the SCRA, even if the rent is past due, the self-storage facility owner can only sell possessions after first obtaining a court order. We at Undisputed Legal are well-versed in eviction proceedings and can ensure that your papers are served diligently to afford you and your family the best relief.

Protection No. 6: Stay proceedings

The court has the authority to enter a stay of proceedings for a minimum of ninety days upon its own motion or upon a service member’s request. This includes applications filed within ninety days after the end of military service.  Involving a private process service agency like Undisputed Legal can relieve some stress from intense legal battles. When deployed on duty, timelines for legal processes can often be difficult to navigate. Undisputed Legal can help deliver your papers on time and without hassle.

The court must designate a counsel to represent the SM in any action or process if it declines to grant an extended stay.  The member is entitled to a stay for as long as the duration required until the finding of material impact is withdrawn after it has been made. It should be noted that courts often are hesitant to provide lengthy stays of proceedings. Therefore, they have the authority to and should demand that members show up to court regularly and in good faith.

When a service member’s military obligations hinder their capacity to be present in court at the appointed time and location or to assist with case preparation or presentation, the court should determine that there has been a ‘material effect’ on the member’s capacity to bring or defend a civil suit. In the absence of evidence of ‘material effect,’ the court retains the authority to request [A.] an affidavit outlining all the facts and circumstances, typically signed by the member or the member’s commander, and [B.]  a copy of the member’s Leave and Earnings Statement, which serves as a pay stub in the military. This statement should indicate the member’s basic pay, Basic Allowance for Housing, Basic Allowance for Subsistence, other pay or allowances, tax withholdings, and voluntary allocations. At Undisputed Legal, we have the experience to serve these affidavits in time. 

For documents to be served by the regulations of the SCRA, it is best to choose a private process service agency like Undisputed Legal that is knowledgeable with those requirements. Service members under the SCRA may have complicated military status that is difficult to ascertain and are often subject to rigorous timeframes under the SCRA. Our Undisputed Legal process servers are experts at delivering them quickly and by SCRA deadlines. We use certificates of service and affidavits to ensure your papers have proof of delivery. Our Undisputed Legal process servers are known for their professionalism and efficiency. Place your trust in us, and let us serve you.

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Sources

1. 50 U.S.C. § 3911, 

The following personnel of the armed forces are subject to the SCRA:

1. Service Members of the  Army, Marines, Navy, Air Force, and Coast Guard; 10 U.S.C. 101(d)(1); 
2. National Guard members who are ordered to respond to a national emergency declared by the President or the Secretary of Defence for more than 30 days in a row under 32 U.S.C. 502(f) with federal funding; and 
3. Commissioned members of the Public Health Service and the National Oceanographic and Atmospheric Administration.
   Any time an SM is off duty due to illness, injury, leave, or any other legitimate reason is covered—that is, he or she is still considered an SM even while not actively serving.
   From the moment they receive orders to report for service until the day they actually report, members of the National Guard and Reserve are granted the protections of the Act under 50 U.S.C. § 3917

2. ‘Home.’ Military Compensation, militarypay.defense.gov/Benefits/Servicemembers-Civil-Relief Act/. Accessed 10 Feb. 2024. 

3. Chapter 50 of Title 50, U.S. Code, 50 U.S.C. § 3901 et seq., contains the present legislation

4.  50 United States Code § 4012

5. ‘Defense Manpower Data Center (DMDC) – SRCA Centralized Verification Service.’ Servicemembers Civil Relief Act Centralized Verification Service, www.servicememberscivilreliefact.com/about-us/defense-manpower-data-center/. Accessed 10 Feb. 2024.

6. U.S. Government Accountability Office. ‘About the Yellow Book.’

7. Tom Feltner and  Wen Liu –. ‘Servicemembers Continue to Face Major Financial Challenges.’ Consumer Financial Protection Bureau, 1 Nov. 2023, www.consumerfinance.gov/about-us/blog/servicemembers-continue-to-face-major-financial-challenges/. 

8. When military members file complaints about potential violations of their SCRA rights, the Consumer Financial Protection Bureau (CFPB) investigates and, if necessary, refers the cases to the Department of Justice.

9. One example is the recent settlement between San Antonio and the Department of Justice after an inquiry into the city’s purported auction off of over 200 military vehicles. Among the terms of the settlement—which is still pending court approval—is that the city would establish a $150,000 compensation fund, implement a policy that complies with the SCRA, and seek a court order to enforce any liens on service members

‘Justice Department Reaches Settlement with City of San Antonio for Illegally Auctioning Servicemembers’ Vehicles.’ Office of Public Affairs | Justice Department Reaches Settlement With City of San Antonio for Illegally Auctioning Servicemembers’ Vehicles | United States Department of Justice, 3 Sept. 2020, www.justice.gov/opa/pr/justice-department-reaches-settlement-city-san-antonio-illegally-auctioning-servicemembers. 

10.   For your active duty, the lender must lower the interest rate on pre-service commitments to 6% in response to a valid request under the SCRA.

11. 50 U.S.C. app.  TITLE II – GENERAL RELIEF § 521. Protection of servicemembers against default judgments [Sec. 201]

12. 50 U.S.C. app. §§ 521, 522 and 524

13. Vehicle leases may be terminated if the service member is PCS OCONUS or deployed OCONUS for at least 180 days

14. TITLE III – Rent, Installment Contracts, Mortgages, Liens, Assignment, Leases § 531. Evictions and distress [Sec. 301]

15. Provided that the motion contains the information necessary for the court to ascertain whether a stay is necessary, as stated in 50 U.S.C. § 3932

16.Section 3932(d)(2) of the United States Code.

17. The SM in Massey v. Kim, 455 S.E.2d 306 (Ga. Ct. App. 1995) requested a stay of proceedings so that he may finish his foreign tour of duty before discovery could be continued. The court rejected his plea, citing advancements in communication technology since the SSCRA was passed. 

After rejecting the SM’s motion to stay discovery, the court in Keefe v. Spangenberg, 533 F. Supp. 49 (W.D. Okla. 1981) ordered the SM to appear by videotape deposition by Fed. R. Civ.P. 30(B)(4).

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Frequently Asked Questions About HOW THE SERVICE MEMBERS CIVIL RELIEF ACT PROTECTS OUR MILITARY

What specific legal protections does the Service Members Civil Relief Act (SCRA) provide to military personnel?

The SCRA offers protections such as postponing or suspending certain civil obligations, including judicial and administrative proceedings, for active duty military members. This allows service members to focus on national defense without the distraction of adverse civil actions that could impact their legal or financial situation.

Does the SCRA protect family members of service members as well?

Yes, under certain provisions of the SCRA, spouses and children of service members are considered covered persons. This means they may receive protections in situations like co-signing loans or other civil obligations tied to the service member’s military status.

Are there any limitations to the types of legal proceedings covered by the SCRA?

The SCRA strictly does not apply to criminal procedures; its protections are limited to civil, administrative, and judicial actions. Federal, state, and local courts and agencies must abide by the provisions of the SCRA when dealing with service members and their covered dependents.

How can a party or court verify the military status of an individual under the SCRA?

The Department of Defense, via the Defense Manpower Data Centre (DMDC), is responsible for maintaining records of an individual’s military status. Any party or court can request a statement from the DMDC to confirm whether a person is currently serving.

Why is it important to use a knowledgeable process service company like Undisputed Legal for serving documents involving service members?

Serving legal documents to military personnel requires compliance with the SCRA’s specific protections and procedures. Undisputed Legal has the expertise to navigate these requirements, ensuring timely and lawful service in accordance with federal law. For assistance, contact Undisputed Legal at 800-774-6922.