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#1081733 - 11/13/08 11:21 PM Need clarification SCRA
Ninky Offline
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Ninky
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Please let me know if I understand this correctly. The 6% interest rate cap only applies to servicemembers who excercise their rights by requesting the relief with the required documentation, orders, etc.. This also provides relief from late charges, fees, service charges, when they exercise their rights.

However, the 90 day stay that has been extended to 9 months on mortgages, Deed of Trust, etc., applies to ALL servicemembers, not just those who exercised their rate cap privileges.

Also, other debt such as cars and personal lines of credit, not secured by a mortgage, remain under the 90 day stay? And is this for all servicemembers also, not just those who exercise their rate cap privileges?

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#1082035 - 11/14/08 04:36 PM Re: Need clarification SCRA Ninky
Dan Persfull Offline
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The stays apply to all active duty servicemembers, regardless if they have invoked their 6% rate limitations. That is why you are asked to certify the borrower is not an active member of the military when you begin legal proceedings.
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#1082290 - 11/14/08 07:27 PM Re: Need clarification SCRA Dan Persfull
Ninky Offline
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Ninky
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That makes sense. The ABA's summary states that the extended stay only covers these real estate obligations originated before the servicemembers's military service. Is that correct?

And does other debt, i.e. cars, plc's, remaining under the 90 day stay, have to be originated before their military service, or is this for all servicemembers?

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#1082379 - 11/14/08 08:55 PM Re: Need clarification SCRA Ninky
Dan Persfull Offline
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Someone may have to correct me because I have not yet fully read the HERA yet. Just bits and pieces of it.

But it has always been my understanding the stay provisions apply to all debts of the servicemember, not just to pre-military debt. The servicemember may have been deployed to a station under conditions preventing them from making proper financial arrangements and I believe the stays were meant to protect the servicemember under those circumstances. However HERA may limit the stay to pre-military debt.
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#1082396 - 11/14/08 09:18 PM Re: Need clarification SCRA Dan Persfull
John Burnett Offline
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HERA made changes to section 527 and 533 of SCRA (we adopted the codified section numbering in BOL's copy of the SCRA found here).

Section 527's extension of the 6% cap to one year after the end of active duty is permanent, and applies only to mortgage debt.

Section 533 was also amended, to extend the stay periods in 533(b) and the foreclosure protection period in 533(c) temporarily -- through 12/31/2010 only -- from 90 days to 9 months.

We have annotated those sections in our SCRA copy. To find them, open the page and do an "in page find" for "amend."
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#1112361 - 01/16/09 04:04 PM Re: Need clarification SCRA Dan Persfull
elcinoca Offline
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Elizabeth City, NC
Did the group reach a concensus on whether the stay provisions apply only to debt incurred prior to active service?

Quote:
Sec. 533. MORTGAGES AND TRUST DEEDS.
(a) MORTGAGE AS SECURITY- This section applies only to an obligation on real or personal property owned by a servicemember that--
(1) originated before the period of the servicemember's military service and for which the servicemember is still obligated;
and
(2) is secured by a mortgage, trust deed, or other security in the nature of a mortgage.
(b) STAY OF PROCEEDINGS AND ADJUSTMENT OF OBLIGATION- In an action filed during, or within 9 months after, a servicemember's period of military service to enforce an obligation described in subsection (a), the court may after a hearing and on its own motion and shall upon application by a servicemember when the servicemember's ability to comply with the obligation is materially affected by military service--
(1) stay the proceedings for a period of time as justice and equity require, or
(2) adjust the obligation to preserve the interests of all parties.


MarkB

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#1113612 - 01/20/09 06:21 PM Re: Need clarification SCRA elcinoca
Andy_Z Offline
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You cite indicates this.
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