The little-known Servicemember’s Civil Relief Act (SCRA) prevents credit card issuers from charging individuals entering, called to active duty in the military, or deployed service members more than 6% APR on what they owe the institutions.

Military.com writes the limit applies to other loans besides credit card debt.

• Outstanding credit card debt
• Mortgage payments
• Pending trials
• Taxes
• Terminations of lease

The article later clarifies the conditions for the 6% APR maximum.

“The SCRA unambiguously states that no interest above 6 percent can accrue for credit obligations (that were established prior to active duty or activation) while on active duty, nor can that excess interest become due once the servicemember leaves active duty – instead that portion above 6 percent is permanently forgiven.”

“Furthermore, the monthly payment must be reduced by the amount of interest saved during the covered period.”

“Note: This law only covers debt incurred prior to military service.”

Recently Lexology.com reported “The U.S. Department of Justice is Ramping Up its Enforcement of the Servicemembers Civil Relief Act.”

“Contrary to beliefs held by many, the SCRA applies to all companies, not just banks. The current law is very broad in scope, providing benefits and protections related to rental agreements, security deposits, prepaid rent, evictions, installment contracts, interest rates on all debt: including home loans, credit cards and student loans, mortgage foreclosure, civil judicial proceedings, automobile leases and repossessions, life insurance, health insurance and income tax payments.”

“On November 2, 2016, DOJ announced a new program, the Servicemembers Civil Relief Act Enforcement Support Pilot Program, to support its enforcement efforts related to protecting the rights of current and former military personnel as part of DOJ’s Servicemembers and Veterans Initiative.”

“The new pilot program funds Assistant U.S. Attorney and trial attorney positions to assist with SCRA enforcement, and also designates military judge advocates currently serving as legal assistance attorneys to serve as Special Assistant U.S. Attorneys to support DOJ’s enforcement efforts related to the SCRA.”

Wells Fargo paid a hefty fine for not following the SCRA guidelines.

“The Justice Department announced that Wells Fargo Bank, doing business as Wells Fargo Dealer Services, has agreed to change its policies and pay more than $4.1 million to resolve allegations that it violated the SCRA by repossessing 413 vehicles owned by protected servicemembers without obtaining a court order.”

“In a separate announcement, the Office of the Comptroller of the Currency (OCC) assessed a $20 million civil money penalty against Wells Fargo for the same infractions.”

The AOG USAA World Mastercard goes one step further for active-duty individuals.

• Special 4% SCRA rate: When you have a balance on your account at the time you enter active military duty, get 4% on that existing balance during the period that you serve your country.
• 100% rebate of finance charges: We’ll rebate all finance charges accrued during a qualified military campaign.

Bank of America has an entire FAQ page on the SCRA.

“For example, the SCRA places a limit on the amount of interest that may be collected on financial obligations of any kind: 6 percent per year during the time of military service. Any amount over and above that 6 percent is permanently forgiven.”

“There are 3 conditions you need to fulfill in order to benefit from the 6 percent interest rate cap provided by the SCRA. You need to have taken out the loan before you began active duty (a loan taken out while on active duty is not eligible for SCRA benefits), you must make a request for benefits within 180 days after the end of your active duty and you must request the benefits by supplying a copy of your active duty orders or other qualifying documentation.”

“If you have a credit card or installment loan amount with Bank of America, we will extend your benefits on those accounts for an additional 6 months. If you have a mortgage account with us, we will extend your benefits for an additional 12 months.”