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#897809 - 01/31/08 10:33 PM SCRA Form Letter Request
Raquel Offline
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Received a request from a borrower who has entered the military service to suspend payments on his loan until he graduates from boot camp. This request was made via a form letter with pertinent information and dates completed by borrower. The reason given for this request was that he would receive no pay until he graduated which is more than 3 months away.

Rate is being reduced to 6% on this obligation. Normal procedure when granting a request for a loan payment extension is to have the borrower sign an extension agreement which gives the date that the extended payment will be due. Borrower is also requested to pay the interest for the deferral period.

Would it be acceptable under SCRA to request the servicemember to sign the extension agreement? Otherwise, at loan maturity, there will be a large balance remaining.

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Lending to Servicemembers (SCRA, JWNDAA), War, Terrorism
#897980 - 02/01/08 02:20 PM Re: SCRA Form Letter Request Raquel
trail hiker Offline
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You didn't say what type of loan or the amount of the balance - Does this loan fit into the parameters of any of the loans affected by JWANDA?

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#898016 - 02/01/08 02:46 PM Re: SCRA Form Letter Request trail hiker
Raquel Offline
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Joined: Aug 2007
Posts: 128
This is not a loan covered by JWANDA - that is why loan balance and type of loan was not mentioned. Borrower obtained the loan prior to entering military service.

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#898287 - 02/01/08 06:00 PM Re: SCRA Form Letter Request Raquel
Andy_Z Online
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The Marines, and perhaps the Navy (both are under the Navy's pay system as I recall) don't get paid while in basic. You are not required to meet this request, but in most circumstances I don't believe you'd be criticized either. Having a signed request for an extension is a bank rule in most cases. There could be a state requirement, I wouldn't know. Rather than go through the pain of sending a request to be signed and returned, I'd respond (if you do this) that you have met the request. Tell them how much the interest is and when it is due. Hopefully you can delay that until the soldiers payday. Tell them when their new maturity is and what they need to start paying, and when.

You're other option is to SCRA the rate to 6% and push them for payments. If the soldier doesn't have a relative to pay for them, you won't have anything but a past due account. There is nothing they can do.
My opinions are not necessarily my employers.
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