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View Full Version : SCRA Mortgage Protection and a Few Other Questions to Boot (Long Post)



kt3of3
11-10-08, 12:13 AM
Greetings to all,

I am currently in the process of becoming becoming a reservist, though I really prefer to take a military leave of absence from my career and go AD. After speaking in-depth with my recruiter, I came to the reserve decision for several reasons. However, I want to exhaust every available resource to find answers to my questions from Marines who have experienced similar circumstances before I complete the process. I don't want to commit to the reserves only to find out later that I could just as easily gone AD.

Here goes:

1) I have a home mortgage and auto loan. If I were to go AD, I would not be able to afford my monthly payments. As I interpret it, under SCRA the lenders are required to reduce my interest rates to 6% (my auto loan is actually less) and I am still required to make the payments. However, I hear mixed interpretations. I've been told that under SCRA, the lenders are actually required to suspend my payments if I can't afford to make them, and I would be able to pick-up where I left off once I fullfill my contract obligations, even if that means not returning to civilian life for 4+ years. I want to go AD, but I don't want to lose everything I've worked so hard for either. Is there anyone on this site who is currently excercising this right in a similiar capacity? Or anyone with intimate knowledge that can elaborate?

2) I'm old as dirt (29). I was told by the recruiter that age cutoff for AD AND reserves is 27 so I'll need a waiver for my age, and that I would have a better chance getting the waiver approved for the reserves than I would for AD. Particularly because the waiver would need to go ALL the way to the top of recruiting to be approved and the General (west recruiting) is not very lenient, if at all, when it comes to approving age waivers for AD. Since I'm on the east/west recruiting border, I've been told that should I be turned down because of age, it's possible to go to a recruiting station next door in Indiana and I would have a better chance at having my age waived for AD since it's a different, more 'lenient' General in east recruiting. Are there any old farts like me in the west that could not get an age waiver approved, recently? Any that did? Any other thoughts?

3) Should I elect to stay on the reserve path, my job schedule requires me to work every other weekend (friday-sunday and occasional over-time on my weekends off). Though the corporation will grant leave and supplement my pay so that I make the same amount of money I normally would for the 2 week (or however long) training session, they will not supplement my pay for the weekend drill sessions. These weekends amount to 43% of my total bi-weekly paycheck. If a drill session is scheduled on a weekend that I'm required to be at work, I am granted a leave of absence, but not supplemental pay. Is it possible to make-up the session with a unit that is drilling on my weekend off, if there is one?

4) The nearest reserve unit to me is located down the block, literally (Co E, 4th Recon Bn). The only open MOS is 0321, reconnaissance man. I understand that selecting 0321 only gets me a seat at the indoc after SOI and that failure would most likely land me as 0311 in a reserve unit that isn't so close to home. I also understand that it's an extreme challenge. I'm reasonably certain that I've read most if not all the posts on this site regarding poolee's and the like opting for the 0321 MOS, but I'm going to pose the question anyway. So, as far as reserve duty and my situation is concerned, is taking a shot at recon a common step for a recruit without prior experience? Or, eventhough it's technically feasible, would I be over stepping a boundary that's normally set for Marines with prior experience?

Regards and thank you,
Kevin

thewookie
11-10-08, 08:44 AM
Greetings to all,

I am currently in the process of becoming becoming a reservist, though I really prefer to take a military leave of absence from my career and go AD. After speaking in-depth with my recruiter, I came to the reserve decision for several reasons. However, I want to exhaust every available resource to find answers to my questions from Marines who have experienced similar circumstances before I complete the process. I don't want to commit to the reserves only to find out later that I could just as easily gone AD.

Here goes:

1) I have a home mortgage and auto loan. If I were to go AD, I would not be able to afford my monthly payments. As I interpret it, under SCRA the lenders are required to reduce my interest rates to 6% (my auto loan is actually less) and I am still required to make the payments. However, I hear mixed interpretations. I've been told that under SCRA, the lenders are actually required to suspend my payments if I can't afford to make them, and I would be able to pick-up where I left off once I fullfill my contract obligations, even if that means not returning to civilian life for 4+ years. I want to go AD, but I don't want to lose everything I've worked so hard for either. Is there anyone on this site who is currently excercising this right in a similiar capacity? Or anyone with intimate knowledge that can elaborate?



The S&SCRA isn't some type or form of bankruptcy protection for new guys goin in. It's for guys already in, who get called up or otherwise. You can't run and hide from your debt, on active duty or the reserves, thinking you can just fall back on the S&SCRA. This is from their website:

6% Interest Rate


If a service member’s military obligation has affected his/her ability to pay on financial obligations such as credit cards, loans, mortgages, etc., the service member can have his/her interest rate capped at 6% for the duration of the service member’s military obligation.
Qualifying debts are debts that were incurred prior to the service member coming on active duty. The service member must be on active duty at the time of the request, and the service member’s military career must have materially affected the service member’s ability to pay on the debt. This provision does not apply to federally guaranteed student loans.
The service member should contact his/her creditor (in writing) and request that his/her interest rate be reduced to 6% according to the provisions of the SSCRA. While not actually required by the law, it's a good idea to include a copy of the military orders placing the member on active duty, as part of the request. The burden is on the creditor to seek relief in court if the creditor believes that the service member’s military career does not materially affect his/her ability to pay.


They're going to screen you, or they should, and if your finances are not in-order, and from what you said, it doesn't appear to me that your finances would be if you went in. So it might be tough muffins.

I'm not an expert here, but I wouldn't let you in if you have to go on government assistance once you're in.

Before you respond, do some reasearch here:http://usmilitary.about.com/od/sscra/l/blsscra.htm

rvillac2
11-10-08, 10:15 AM
2) I'm old as dirt (29).

What does that make us?




3) If a drill session is scheduled on a weekend that I'm required to be at work, I am granted a leave of absence, but not supplemental pay. Is it possible to make-up the session with a unit that is drilling on my weekend off, if there is one?


No, only under extraordinary circumstances will you be allowed to drill any other unit besides your home unit. The command can excuse you for special circumstances (like a wedding that you're in, or birth of your own child) but you would make up those drills at your home unit at an appointed time. Be prepared to service gear, clean weapons, and/or clean the head of you're still a non-rate.

Note: If you continue to miss drills and fail to make them up within the prescribed time, you will not meet the requirements for a satisfactory year. Only satisfactory years count against your contracted service obligation.

Since drill schedules are made up a year in advance, you are better off trying to schedule work around drill other than the other way around.

kt3of3
11-10-08, 03:10 PM
The S&SCRA isn't some type or form of bankruptcy protection for new guys goin in. It's for guys already in, who get called up or otherwise. You can't run and hide from your debt, on active duty or the reserves, thinking you can just fall back on the S&SCRA.


I've read the article from about.com several times and it very clearly explains:

"Section 301 is designed to protect the service member who, prior to entry into military service, has entered an installment contract for the purchase of real or personal property."

This is how others seem to interpret it as well. More than one person, including my recruiter has made it sound as if, under the law, your lenders now have to grant you some sort of deferral of payment during your service which would essentially put payments on hold until you return from your obligation and can afford to begin making payments again. It seems far-fetched, that's why I'm looking for more answers. Simply accepting that advice as gospel would have serious consequences on me financially.

I'd also like to make it clear that I'm not trying to run and hide from my debt, my finances are on point. You are correct however, they would not be if I went in and it all centers on the ole house/anchor/ball and chain.



What does that make us?I don't know what it makes you, but I've lost count of how many times someone has added, 'because you're so damn old' to whatever information or advice they've given me, so I figured I'd get it out of the way and just proclaim it myself.

rvillac2
11-10-08, 06:00 PM
Historically, the SSCRA has been defined by the court judgements that concern it. Fortunately, you and your advisors can interpret it all you want. The ultimate decision is up to the court.

The Act is there to prevent them from doing things to you, like evicting or repossessing you while you're deployed. It doesn't prevent them from making your life miserable and making you hire attorneys to defend your interests.

It goes like this:
You enter service and suffer a loss in income that results in your disability to make timely payments. You apply to the lender for relief under the SSCRA and they evaluate your application. They will look for any reason to disqualify you. If there is evidence that you are trying to escape default, or you are trying to cheat them in some way, they can deny you. If things are on the up and up, they can make arrangements with you on a case by case basis; ie deferrment of payments with interest accruing at 6%, payments of interest only, deferrment without penalty.

The point I am making is that it is not automatic and not one situation fits all. If they elect a plan that does not fit to your liking, it's your burden to appeal it (with a lawyer).

For people who are involuntarily called to active service (through the draft or reservist activation), the situation is more cut and dry. The bank recognizes that your service is involuntary and is more likely to grant a deferment without opposition. This occured on a widespread basis during the 1st Gulf War and I expect has resumed since 9/11.

Another point to make is that this does not usually apply for Reservists Initial Active Duty for Training. This is your time in Boot Camp/MCT and MOS school. This takes around 6-9 months and then you return to civilian life. The SSCRA would only apply to you if you are involuntarily activated for a deployment (which is expected to be less and less likely with the new administration). Once again, you could ask, but if they deny you, it's on you to fight them.

Hope this helps.

kt3of3
11-10-08, 06:53 PM
rvillac2:

That was the best information I've received yet. Thank you. I had a very difficult time believing that the protection is cut and dry, rock solid, and finite but that's how it's been presented to me. Thank you for the help.

Regards,
KT

rvillac2
11-10-08, 07:05 PM
Happy to help.
It may be useful for you to contact your lender and ask for information ahead of time. Who knows, they may be overly generous and bend over backwards to help you. If not, then at least you'll know where they stand.