We check the Dept. of Defense page monthly to check if any of our delinquent borrowers are also listed as active duty.

We found one person and sent him a letter asking for the paperwork. He hasn't responded to our request.

In such a case would we be expected to change the loan rate and payments and discontinue charging late fees even though we don't have the paperwork?

The interest rate relief provision does not kick in until the servicemember requests the relief and provides a copy of their orders to the FI. They may request the relief up until 180 days after the end of their active duty and the relief would be retroactive for the full period they were on active duty.

However, whether you require the paperwork is your decision. You (the FI) are not required by the SCRA to have the paperwork to grant the relief.