With today’s world events, I’m worried I’m going to get called to active duty, and I won’t have enough income to support my family. How can I protect my family from losing our home?
The United States has a tradition of protecting the financial interests of service men and women dating back to the Civil War, according to Edward Rue, a Johns, Flaherty & Collins attorney.
"During the Civil War, there was a moratorium on all civil action against Union soldiers," he said. "That included protection from foreclosures, civil actions and divorce. Modern acts have not been as generous, but still offer protection."
The Soldiers and Sailors Civil Relief Act of 1940 has been in effect - with some amendments - since World War II. It provides protection for members of the armed services who have been "materially affected," meaning those who have significantly less income in the military than in civilian life. Under this law, you and/or your dependent family members have some additional rights.
For example, once you’ve given written notice to your creditors that you are on active duty, your interest rate on debts is limited to 6 percent while on active duty. This interest rate limit applies to mortgages and consumer debt, but not student loans, according to Rue.
The law also requires a creditor to get a court order to foreclose on you or a dependent family member, but you can delay a foreclosure for three months or longer, depending on the circumstances. You also have an extended period of redemption, which means you have a longer time after a foreclosure to reclaim the property by fully repaying the debt.
Other provisions apply to leased property. For example, if you pay less than $1,200 monthly rent, your landlord must go to court to get an eviction, which can be delayed for up to three months to give you more time to come up with the money or find alternative housing. The law also has provisions for getting released from a lease.
"This law doesn’t allow you to live rent free, but offers significant protections," Rue said. "If you have a legal problem, most posts have legal services available for members of the service, or a Johns, Flaherty & Collins attorney can help."
For more information about the Soldiers and Sailors Civil Relief Act, contact Johns, Flaherty & Collins at 608-784-5678.