Back in December 2022, the CFPB issued a report titled, “Protecting Those Who Protect Us”. The main premise of the report was that protections under the Servicemember Civil Relief Act (SCRA) are being underutilized. Specifically, the report focuses on the interest rate reduction benefit for debts incurred prior to active-duty service. Under the SCRA, the interest rate on debts incurred before a servicemember’s active-duty status cannot exceed 6% during active duty and, in some cases beyond. For mortgages and similar debts, the 6% limit extends for one year after active duty. At that time the report was issued, the CFPB estimated that, between 2007 and 2018, servicemembers lost around $100 million because interest rates were not reduced as required. This is still a good reminder today!
We encourage you to check out the report as it offers some potential ways to increase compliance with these required SCRA protections.
Published
2024/03/15