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Understanding the Soldiers and Sailors Civil Relief Act

The Soldiers and Sailors Civil Relief Act of 1940, the statute currently in effect, has its roots in the Civil War. At that time, Congress passed legislation requiring courts to put a wide variety of civil suits and other matters involving soldiers, sailors and marines then on active duty on hold until they returned from the war.

At the time, this was necessary because troops conscripted for the war effort received very low pay, and it would have been possible for many of them to honor debts incurred prior to the war.

The law was reenacted in 1918 to protect World War One troops for similar reasons, though the law expired with the end of the war.

The current law, passed in 1940, however, has no built-in expiration date, and remains in effect protecting active duty service members on federal orders today. Congress has updated the law by amendment many times, adjusting it as circumstances require, but the basic outline of protections for active duty troops remains the same.

Who’s Covered?

The law applies only to uniformed military service members on federal active duty under Title 10 orders. It does not apply to Reserve and Guard members, unless they are on federal active duty. Active Guard status does not count, since Guard status is generally under Title 32 orders, not Title 10. However, the SSCRA does apply to Guard troops called to active duty in response to a federally-declared disaster, when serving on missions supported by federal funds.
Retired service members are not covered. Only those on active duty are covered under the SSCRA.

Individual courts may also set aside the SSCRA’s protections if the judge determines that your ability to represent yourself in court is not affected by your status on active duty. So if you’re working a desk job for the military right up the street from the courthouse, don’t count on the SSCRA’s protection applying to you (see Section 521 of the law).

What Actions are Affected?

The law allows judges – and in some cases requires them - to set aside, delay or vacate certain proceedings until 60 days after the service member’s return from active duty.

Affected proceedings include, but are not restricted to the following:

  • Garnishments
  • Foreclosures
  • Attachments
  • Bankruptcies
  • Divorce proceedings
  • Evictions
  • Child support hearings
  • Executions of judgments
  • Repossessions

If a court grants a stay, the stay can remain in effect for the duration of the service member’s tenure on active duty, plus 90 days. However, as indicated above, creditors may be able to convince a judge that your active duty status has not materially affected your ability to represent yourself in court, or pay your debts.

The 6 Percent Cap

If you are called to active duty, and you have outstanding debts, the law requires lenders to set a maximum interest rate cap of 6 percent on your debts. Creditors can’t shoehorn other charges into your bills, either – the 6 percent interest cap also applies to service charges, late fees, renewal fees, debt rollover fees (common at payday loan outfits) and other small-print fees. However, the 6 percent cap doesn’t include bona fide insurance premiums. So if you have a credit card, and you pay for life insurance or credit insurance on top of your principal payments and interest, the lender will cap the interest rate at 6 percent, but you will still pay the insurance premium charges as agreed.

Incidentally, the law also forces creditors to lower payments required on time loans, reflecting the six percent interest rate (assuming that the rate on the original loan is higher than 6 percent). Meaning the bank or other should lower your payments, rather than keep minimum payments at the same level.

Again, the 6 percent rate is not automatic. The creditor can appeal to a court and make its case that your ability to pay the debt is not materially affected by your active duty status. This is relatively rare, but it can happen.

Also, if you have someone co-sign a loan for you, or if you co-signed the loan, the same terms apply to everyone. Everyone gets the 6 percent rate for as long as the borrower is on active duty.

Note: If you have federally guaranteed student loans outstanding, the 6 percent rate cap does not apply. You must still pay the full interest rate on these loans, though you may apply for a hardship forbearance.


Broadly speaking, the SSCRA prohibits lenders from foreclosing on mortgages under the following conditions:

  • The property was acquired prior to the service members' entry into active duty.
  • The service member defaulted while still on active duty.

As with other circumstances, a judge may rule that your ability to pay your mortgage was not materially affected by your entry into active duty, and therefore allow a foreclosure proceeding to go forward, even if you are on active duty.

Eviction Protection for Dependents

The Soldiers and Sailors Civil Relief Act helps protect your spouse and children from being evicted from your home while you are serving on active duty – provided your rental payment is less than $1,200 per month. Note that this provides quite a bit more protection for those of you who live in Killeen, Texas than it does for those in New York City, San Francisco and Honolulu. For maximum protection, keep your rental payments under $1,200 per month.

Note that if your landlord attempts to evict in violation of this statute, he or she is guilty of a misdemeanor violation of federal law, and potentially subject to a 1 year prison term, or a fine of up to 100,000.

However, most landlords will go to court to show that you can still afford to pay $1,200 months in rent, rather than have a family live in their property for free for months while they themselves carry their own mortgage payments, tax obligations, maintenance, etc.

Installment Contracts

If you are a civilian or reserve component service member and you buy something on payments – commonly a car or car lease – the SSCRA gives you certain rights to cancel an otherwise non-cancellable arrangement and return the merchandise. For example, you can get out of a car lease if you are called to active duty, though you must return the car.

Note that this provision only applies to those who were not on active duty when they incurred the obligation, but subsequently received orders to active duty.

Credit Reports

Creditors cannot report certain negative information about you to the credit bureaus. For example, it is against the law for your creditor to transmit a negative report to a credit bureau solely because you asserted your rights under the CCRA. (This is a relatively recent modification, signed into law in 2003.)

How to Assert Your Rights under the SSCRA

Generally, you can assert your SSCRA rights upon entering active duty by sending a letter, stating you are on active duty, and providing documentation, such as a copy of your orders, or a letter from your commanding officer.

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