We have a reserve member who is back from active service. His Mortgage has been at 6%. Can tyhe mortgage now go back to the original rate or was there something recently passed that states it must stay that way 12 months after active duty is ended. Please let me know where I can find this? thanks.

Here is what I found in my notes on a checklist I created using information form a Pegaus training manual.

"Creditors must maintain the interest rate reduction for the period of military service, except in the case of a mortgage, trust deed, or other security in the nature of a mortgage, where the interest rate reduction extends for one year after the end of the servicemember’s military service."

Sounds like you have to extend the 6% for 12 months after the end of activie duty date.

That would be correct.

That was a change in the SCRA. Older training materials may well not have that, but it is correct.

Would "mortgage" cover agricultural real estate loans? I've done some research but I don't know if the additional 12 months at 6% is limited to residential real estate.

Okie Banker,

It's a consumer protection law and I'm pretty sure it wouldn't cover Ag RE loans as they would be considered to be a business loan.

SCRA protection extends to all credits of the servicemember whether consumer, business or agricultural.

That section refers to "secured by a mortgage, trust deed, or other security in the nature of a mortgage" and I suspect your lien on ag property fits that. It doesn't differentiate between the purpose of the loan or use of the land. As Dan noted, we've seen court cases that look not at the purpose, but at the obligation of a SM. So I see no reason it wouldn't apply to ag property.

This extended time was based on HERA amendments.

HERA also lengthens that time period from 90 days to a 9 month period after military service for court action. This increase is temporary however, extending only from July 30, 2008 until December 31, 2010.

I was trying to find on the HUD website the udated SCRA notice that includes these HERA changes and cannot find it. Does snyone know where I can find one?

The form on HUD's website shows an expiration date of 9/30/2010 at the top and 2/2007 at the bottom and doesn't reference the HERA changes.

http://www.hud.gov/offices/cpd/about/hudvet/library/scra.cfm

Also, see this thread:

http://www.bankersonline.com/forum/ubbthreads.php?ubb=showflat&Number=1453674