Know Your Rights
Servicemembers Civil Relief Act (SCRA)
The Servicemembers Civil Relief Act (SCRA) is a federal law designed to ease financial burdens on servicemembers and their dependents during periods of military service. The SCRA provides protections for military servicemembers as they enter active duty as to financial transactions entered into before the start of active duty.
Military service includes: full-time active duty members of the five military branches (Army, Navy, Air Force, Marine Corps, and Coast Guard); Reservists on federal active duty; members of the National Guard on federal orders for a period of more than 30 days; servicemembers absent from duty for a lawful cause or because of illness, wounds, or leave; and Commissioned officers on active duty with the Public Health Service (PHS) or the National Oceanic and Atmospheric Administration (NOAA).
The SCRA covers issues such as loan interest rates (capped at 6 percent per year), rental and lease agreements, direct payroll allotments, assignment of life insurance, repossession of personal property (such as a car or boat) purchased or leased through an installment contract, eviction from primary residence (depending on monthly rent amount), foreclosure on residential property secured by a mortgage or deed, and other negative actions by creditors.
To learn more, visit:
United States Department of Justice (opens new window)
United States Department of Defense (opens new window)
United States Department of Veterans Affairs (opens new window)
Military Lending Act (MLA)
The Military Lending Act (MLA) is a federal law designed to protect active duty military personnel, including those in the active National Guard or Reserve, as well as their spouses and other dependents, who enter into consumer credit transactions after active duty begins.
The MLA limits the amount a creditor may charge you while on active duty, including interest, certain fees, charges imposed for credit insurance, debt cancellation and suspension, and other credit-related add-on products sold in connection with the loan or transaction. The total charge, expressed as the Military Annual Percentage Rate (MAPR) may not exceed 36 percent. Some charges included in the MAPR are excluded from the finance charge or interest rate disclosed under the Truth in Lending Act and Regulation Z.
To learn more about these and other MLA protections, visit:
National Credit Union Administration: Service Member Lending and Credit Resources (opens new window)
Consumer Financial Protection Bureau (opens new window)
Department of Defense: 2015 Final Rule (opens new window)