Servicemembers Civil Relief Act (SCRA)

Who is protected

The Servicemembers Civil Relief Act (50 U.S.C. § 3901 et seq.) protects servicemembers on active duty — including members of the National Guard and Reserves called to active service — and in some cases their dependents.

Key protections

• 6% interest cap (§ 207): debts taken on before active duty — credit cards, car loans, mortgages and more — can be capped at 6% interest during service (and for one year after, for mortgages). Send your creditor a written request with a copy of your orders no later than 180 days after your service ends. Interest above 6% must be forgiven, not deferred.
• Foreclosure protection (§ 303): for mortgages taken out before service, a foreclosure sale during service and for one year after generally requires a court order.
• Default judgments (§ 201): courts must take steps to protect servicemembers before entering a default judgment.
• Lease termination (§ 305): servicemembers who receive qualifying orders can end residential and vehicle leases early without penalty.
• Stays of proceedings: courts can pause civil cases when military service materially affects a servicemember’s ability to participate.

Credit reporting protections

Using an SCRA protection may not, by itself, be the basis for a negative credit report or denial of credit. Servicemembers can also place a free active-duty alert on their credit files under FCRA § 605A, which lasts one year and can be renewed.

Sources: Servicemembers Civil Relief Act, 50 U.S.C. §§ 3919, 3931, 3937, 3953, 3955; Fair Credit Reporting Act, 15 U.S.C. § 1681c-1(c); Military Lending Act, 10 U.S.C. § 987.