Good afternoon,

Does anyone have detail around the provision of the Housing and Economic Recovery Act which extends the rate reduction on SCRA accounts to one year after active duty ends? From what I have read, this provision went into effect July 30, 2008. How does this impact accounts in which the rate was lowered before July 30? Thank you.

IMO the servicemember can request the 1 year extension anytime during their active service or within 180 days after their active service ends.

So the service member must request the extension? Does this request for the one year extension apply to loans in which the SCRA rate reduction is applied after July 30, 2008? TY!

You are under no obligation under the SCRA to reduce the rate until the servicemember requests it and provide supporting documentation of their active duty status.

The extension applies to any pre-active duty loan regardless when the rate reduction took effect.

Scenario - a service member provides the required documentation and the rate is reduced to 6% on September 1, 2007. Active duty ends June 30, 2008 and the rate is changed back to the original rate. Do we have any obligation in regards to the one year provision of HERA?

This is only an opinion but if the servicemember requests the extension on or before 12/30/08 it would be my opinion you would have to honor the 1 year extension from 6/30/08 to 6/30/09.

Another scenario: the servicemember returns from active duty anytime after the law was passed. We reduced their rate to 6% when they left for active duty...are we obligated to keep the rate at six percent for twelve months after active duty is over or does the servicemember have to request it?

I think you have to continue to reduce it for the 12 months after the person is discharged based on Section 2203 (a) (1)of the new law.