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#203824 - 06/24/04 01:57 PM Re-enlistment- SCRA relief eligibility
JJohns Offline
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Scenario described to me by our collection deparment: Debtor on an auto loan was active duty military when he took out loan. He subsequently left the military for some time but has now re-enlisted.
Would he qualify for SCRA relief?

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Lending to Servicemembers (SCRA, JWNDAA), War, Terrorism
#203825 - 06/24/04 02:53 PM Re: Re-enlistment- SCRA relief eligibility
Andy_Z Offline
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Good question. While the core of the matter is, did his circumstances change between the loan and the re-up, likely not, the SCRA doesn't address this as I recall. I think I'd weigh the interest differential to attorney's cost to research it. Then look further at the risks/costs of defending your position.
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#203826 - 06/24/04 04:33 PM Re: Re-enlistment- SCRA relief eligibility
Anonymous
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No, SCRA protection (6% interest rate reduction)does not apply. I know one could argue that getting out as an E-5 and coming back in as an E-4 means less pay, but that doesn't change the fact that the debt was incurred during in military service.

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#203827 - 06/24/04 04:38 PM Re: Re-enlistment- SCRA relief eligibility
Don_Narup Offline

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I agree with Anon. Debt was incurred during military service which excluded SCRA eligibility for the life of the debt. If the loan was refinanced or modified when the party was a civilian and they then re enlisted, then IMO you may have a SCRA situation.
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#203828 - 06/24/04 04:40 PM Re: Re-enlistment- SCRA relief eligibility
JJohns Offline
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Thanks Andy. There was a Supreme Court ruling awhile back regarding an SSCRA case in which the Court commented that the act "...must be read with an eye friendly to those who drop their affairs to answer their country’s call."
Since our scenario does not appear to be specifically covered in the Act, after looking at the big picture we've decided to grant the relief.

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