The Servicemembers Civil Relief Act (SCRA) has been amended to make it easier to terminate residential housing and automobile leases without penalty. Servicemembers, veterans, and their families should also be aware to do the necessary due diligence before waiving their SCRA rights. Not doing so may result in dire consequences!
The SCRA provides extra protections for servicemembers in the event that legal or financial transactions adversely affect their rights during military or uniformed service.
The SCRA applies to the following servicemembers:
SCRA rights may also be exercised by anyone holding a valid power of attorney for the servicemember. Some SCRA protections also apply to dependents.
Today, many businesses provide consumers with the option to conduct transactions and communications electronically, whether it’s leasing a residence or purchasing an automobile. However, certain landlords and automobile dealers have denied servicemembers the convenience of terminating their leases electronically. Instead, servicemembers had to provide them with written notification by hand delivery, private carrier, or regular postal mail with return receipt requested.
This year, the SCRA was amended to allow qualified individuals the ability to terminate these lease agreements electronically by sending a notice of termination along with a copy of their orders – or a letter from their commanding officer via email or through a communications portal designated by the lender or agent.
Servicemembers are sometimes asked or pressured to waive their SCRA rights in order to lease a residence. Recently, a servicemember reported
that while going through a Permanent Change of Duty Station, she conducted her entire housing search online, came into town to pick up keys from the leasing office and was handed an SCRA waiver form. She reported feeling pressured to sign the waiver because she was new to the area and did not have anywhere else to live. Four-hundred thousand servicemembers undergo a Permanent Change of Duty Station annually, according to the United States Department of Defense
It’s important to understand the impact that waiving your SCRA rights may have on your finances and your ability to complete your military duties. The waiver may allow landlords or creditors to obtain quick default judgments while a servicemember who is deployed or moved out of the area, for official reasons, has no way to defend him or herself. Servicemembers, including all officers, are also subject to routine national security clearance checks that include detailed reviews of their credit history, and these judgments can negatively impact your credit report, which can have long-term financial implications and make it difficult to obtain a clearance or promotion.
Before signing an SCRA waiver, make sure to read it carefully and talk with a military legal assistance attorney
or private attorney for guidance.
It is illegal for you to be retaliated against for asserting your SCRA rights. If you believe your rights have been violated, you can:
We’ve developed several resources to help you better understand the full financial and legal protections available to you under SCRA:
Additionally, our Office of Enforcement has a single point of contact to provide training on certain aspects of federal consumer financial laws and technical guidance to military legal staff and personal financial readiness managers and staff.
If you want to republish the article or have questions about the content, please contact the press office.
Subscribe to our email newsletter. We will update you on newsroom updates.
Subscribe to our RSS feed to get the latest content in your reader.