Did you know that active-duty service members are limited to the amount of interest that can be charged? The Servicemembers Civil Relief Act (SCRA) limits the amount of interest that can be charged for certain loans taken out prior to enlistment into active-duty military service to six percent. This cap applies to mortgages, auto loans, student loans, credit cards, and other installments loans taken out after August 14, 2008. The service member must currently be in active-duty military service and the loan had to have been taken out before enlistment. The lender must be notified in writing and a copy of military orders to active duty must be included. A request for interest rate reduction may be made at any time while on active-duty and up to 180 days after release from active duty.
More information can be found at https://www.consumerfinance.gov/ask-cfpb/when-am-i-covered-by-the-servicemembers-civil-relief-act-scra-en-2086/.
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