SCRA adds an independent verification option for credit unions
Happy Holidays, Compliance Friends! Nothing puts me more in the holiday mood than a good movie. One of my favorites holiday movies is the Sound of Music! I hope that each of you is taking some time to enjoy this time of year with the ones you hold most dear. Yes, I wanted that to rhyme.
Back to our regularly scheduled programming, this post highlights a fairly recent change to the SCRA, which will hopefully make it easier to provide protections to members of the armed forces and stay compliant.
As a bit of background, the Servicemembers Civil Relief Act (SCRA) provides members of the armed forces with certain financial protections for debts incurred prior to military service. These protections include interest rate reductions, the ability to terminate leases and protections against foreclosure and repossession. The protection begins when the member enters “military service”, i.e., active duty status. One common issue for SCRA compliance is servicemembers properly notifying credit unions of their active duty status to cap their interest rate at six percent.
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