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#2161169 - 01/19/18 09:28 PM Refunding Interest for SCRA
Lizzyp Offline
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Joined: Dec 2017
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We have a customer that obtained a vehicle loan in 2014 at 9% and he joined the military in 2015. The customer has recently let us know that he is military and wants the 6% on his loan. Do we have to forgive the interest from time of active duty to present?
We will reduce the interest rate once we receive the active duty military orders.

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Lending to Servicemembers (SCRA, JWNDAA), War, Terrorism
#2163031 - 02/02/18 09:40 PM Re: Refunding Interest for SCRA Lizzyp
Andy_Z Offline
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You have the right to a written request and a copy of the orders and yes, from the date he went active (assuming he wasn't called up to active duty) until the date you make the adjustment you'll back off the interest difference between 9 and 6 percent (including late fees if applicable) and start the new accrual at 6 percent.

The SCRA is silent as to that payment but in the spirit of the law I recommend first offering it to the borrower, or at their option making a principal reduction. In that it is forgiven and needn't have been paid in the first place, that is why I'd offer it to the SM first.
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