Thread Options
#447415 - 10/26/05 04:37 PM Past Due Loan

I need help! We have a customer who is currently on Active Duty. His car loan is late and the co-borrower is saying that we can't report him as late to the credit bureau because he's at war. In addition, she's saying that she can take herself off of the loan as co-borrower. All of this is covered by the Soldiers & Sailors Act, she says.

I know NOTHING about the Soldiers & Sailors Act. I've been researching to find answers to these questions, but haven't had any luck. Does anyone out there have answers for me? I really appreciate it!

Return to Top
Lending to Servicemembers (SCRA, JWNDAA), War, Terrorism
#447416 - 10/26/05 04:54 PM Re: Past Due Loan
Dan Persfull Offline
10K Club
Dan Persfull
Joined: Aug 2002
Posts: 46,707
Bloomington, IN
First contact your attorney as collection actions are limited in some cases, i.e. they require court approval. And if you are not comfortable with SCRA then you need someone guiding you that is familiar with the "dos and don'ts".

Second, there is nothing in the Federal statute that prevents you from reporting the account past due to the CRAs. However, you may need to check state laws.

Third, the SCRA does not give the co-borrower the right to remove themselves from a legal contract. However, there are some lease exceptions in the SCRA.
The opinions expressed are mine and they are not to be taken as legal advice.

Return to Top
#447417 - 10/26/05 04:59 PM Re: Past Due Loan

Thanks, Dan. You're the BEST!

Return to Top
#447418 - 10/31/05 05:48 PM Re: Past Due Loan
Andy_Z Offline
10K Club
Joined: Oct 2000
Posts: 27,468
On the Net
Tell the co-borrower that you are in a non-smoking office and to stop blowing smoke. Dan is correct. There are protections, but none in the federal law say they don't have to pay you and that you cannot report them as past due.

What you cannot do is report them as past due because they invoked SCRA rights. You cannot report the difference between 6% and your contract rate as past due.

And depending on who this co-borrower is, they could be not covered by the SCRA. While the spirit and intent of the law is one thing, the SCRA recognizes joint debts as between the servicemember and their spouse.
My opinions are not necessarily my employers.
Rules and Regs minus Relationships equals Resentment and Rebellion. John Maxwell

Return to Top

Moderator:  Andy_Z