7/31/2019 SCRA is an Acronym for Servicemembers Civil Relief Act

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By: Dan Harris - New York

SCRA is an acronym for Servicemembers Civil Relief Act it applies to active duty

military personnel who had a mortgage obligation prior to enlistment or prior to beingordered to active duty.

It covers members of the Army, Navy, Marine Corps, Air Force, Coast Guard, NationalGuard; commissioned officers of the National Oceanic & Atmospheric Administration

and the Public Health Service who are engaged in active service; reservists ordered to

report for military service; persons ordered to report for induction under the MilitarySelective Service Act; and Guardsmen called to active service for more than 30

consecutive days. In limited situations, dependents of servicemembers are also entitled to

protections.

The SCRA is a federal law (formerly known as The Soldiers' and Sailors' Civil Relief Actof 1940) which provides military personnel important rights and protections as they enter

active duty, on issues that include mortgage interest rates, mortgage foreclosure, and

credit card interest rates.

One of the major benefits is the ability to reduce mortgage interest rates and consumer

debt interest rates (including debts incurred jointly with a spouse) to a 6% limit under

certain circumstances. The mortgage or debt must have been incurred before entry intoactive military service, and the service member must show that military service has had a

"material effect" on the legal or financial matter involved. This provision applies to both

conventional and government-insured mortgages.

The interest rate reduction is not automatic. You must submit a request in writing.

This benefit is in sharp contrast to the protections afforded the civilian population. Underthe Obama Administrations Making Homes Affordable Plan (HAMP) which reduces

interest rates to as low as 2%.

Most lenders will not try to assist military Servicemembers utilizing the HAMP program,in fact research shows that most lenders will not even tell Servicemembers who ask for

assistance that the HAMP program is available to them.

Lenders routinely transfer the file to a separate department inside the company that dealsspecifically with Servicemembers. These internal departments are set up to save thelenders money by limiting the lenders losses. They will not offer the Servicemember the

HAMP program unless it is specifically requested. Lenders have adopted the tactic of

intimidating Servicemembers who ask for consideration under HAMP by making themsign a letter WAIVING THEIR RIGHTS under the SCRA. This tactic has the

chilling effect of stopping the request for HAMP dead in its tracks in many, many cases.

7/31/2019 SCRA is an Acronym for Servicemembers Civil Relief Act

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Many people ask; why wouldnt military men and women be given at least the same

benefits afforded to the public they serve to protect?

I ask; why wouldnt our enlisted men & women be given more than what is available to

the public they serve?

Loan Modification programs administered by lenders, servicers and investors are fraught

with bureaucratic paperwork request and extensive delays due to incompetence and

neglect on the part of lenders.

This nature of requesting assistance from lenders is one that requires a massive level of

follow up by the borrower seeking assistance. Lenders use this to their advantage by

denying assistance to those who dont or cant comply with their request.

Servicemembers have the added burden of being unable to handle the workload of their

service requirements while trying to compile paperwork while deployed.

Some lenders like to utilize their PR machines to tout what they are doing for ourServicemembers. For instance, Bank of America issued a Press Release on March 10th,

2011 indicating that they were going further than the norm by offering a reduction

down to 4% for Servicemembers who qualify.

Unfortunately, the fine print says that this is for loans owned and serviced by Bank ofAmerica. One needs to take look at the complex world of mortgage securitization to

understand what the effect of the statement owned and serviced by means.

The author has determined that this press release is the Bank of Americas attempt to reap

the benefits of a Press Release while making sure it offers as little help as possible.

In one case in particular a California Servicemember (Staff Sergeant A) who has been

deployed on numerous occasions asked for permanent mortgage assistance under HAMP.

After more than a year of sending document after document for endless review Staff

Sergeant A was denied permanent mortgage assistance under HAMP.

Staff Sergeant A then asked for assistance under the SCRA. After another lengthy reviewprocess he was finally approved for a temporary reduction to 6% interest rate under theSCRA. When asked why the rate wasnt reduced to the advertised 4% Bank of America

employees insisted that the loan which was originated by Countrywide and subsequently

purchased by Bank of America wasnt actually owned and serviced by Bank ofAmerica.

The bottom line is that Bank of America refused to live up their commitment in theMarch 19th, 2011 press release, thereby taking public credit for helping

Servicemembers while limiting their losses by hiding behind the carefully worded

owned and serviced by press release in private.

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When questioned by the author regarding this matter Bank of America employees,including representatives in the office of the CEO Brian Moynihan repeated the

convoluted explanation that a loan which was originated by Countrywide and purchased

by Bank of America was somehow not owned and serviced by Bank of America.

Another question raised by this apparent deceptive press release is; why would Bank ofAmerica bother to issue a press release they intended to minimize the effect of?

The answer may very well be that Bank of America CEO Brian Moynihan had his PR

people devise a plan to get out in front of this Justice Department Press Release date May

26th

, 2011 wherein, Bank of America was forced to settle with the Justice department toresolve allegations that the lenders wrongfully foreclosed upon active duty

servicemembers without first obtaining court orders, in violation of the SCRA.

Servicemembers and their dependents who believe that their SCRA rights have beenviolated should contact the nearest Armed Forces Legal Assistance Program office.

Please consult the military legal assistance office locator athttp://legalassistance.law.af.mil and click on the Legal Services Locator. Additional

information about the Justice Departments enforcement of the SCRA and the other lawsprotecting servicemembers is available at www.servicemembers.gov. Servicemembers

who believe they may have been victims, can contact the Justice Department directly at

1-800-896-7743, mailbox 6 for Countrywide or 1-800-896-7743, mailbox 995 for Saxon.

As of the date of this article Bank of America has continued to refuse to look into Staff

Sergeant As matter any further.