According to an article in the Dallas Morning News, the Servicemember’s Civil Relief Act (SCRA) provides a wide range of protections for active duty members who may be facing high interest rates on their credit cards.
The article said:
“The Servicemember’s Civil Relief Act provides a wide range of protections for active-duty military members. It’s aimed at postponing or suspending certain civil obligations to enable service members to devote full attention to duty and relieve stress on the family members. Among other things, the law limits the interest charged to active-duty service members to 6 percent on credit obligations, including credit card debt, incurred prior to military service.”
The SCRA specifically states that no interest above 6 percent can accrue for credit card debt obligations while on active duty. Also the excess interest that would have accrued on the active duty servicemember’s credit card cannot become due once the servicemember leaves active duty. Any interest that would have accrued on the servicemember’s credit card above 6 percent is permanently forgiven under this act.
Also, the active duty servicemember’s monthly minimum credit card payment must be reduced by the amount of interest saved during the eligible period. Please note that these rules only apply to credit card debt incurred prior to beginning active duty. The credit card protection begins on the date of entering active duty and generally terminates within 30 to 90 days after the date of discharge from active duty.
