Soldiers' and Sailors' Relief Act of 1940
by
Paul Stone |
|
WASHINGTON -- If you're one of the
thousands of reserve component service members called to active
duty, you're protected by a law that can save you some headaches --
and possibly more than just a few dollars.
Under provisions of the Soldiers' and
Sailors' Relief Act of 1940, you may qualify for any or all of the
following:
 |
Reduced
interest rate on mortgage payments. |
|
Reduced
interest rate on credit card debt. |
|
Protection
from eviction if your rent is $1,200 or less. |
|
Delay
of all civil court actions, such as bankruptcy, foreclosure or
divorce proceedings. |
"Service members in general just
don't understand the depth of protection and their rights under this
act," said Air Force Maj. Amy Griese, assistant director for
legal policy in DoD's office of personnel and readiness. Griese
talks about the act not only with the expertise of knowing its
protections forward and backward, but with the enthusiasm of an
advocate for service members.
In addition to the protections
involving debt payments and civil litigation, the act guarantees
service members the right to vote in the state of their home of
record and protects them from paying taxes in two different states.
Most provisions of the act are
automatic, but Griese emphasized that those involving debt payments
are not. Under the act, service members on active duty can have
mortgage and credit card interest rates reduced to a fixed rate of 6
percent.
Material Effect
In order to qualify for the
reduction, however, service members must be able to demonstrate what
is called "material effect," Griese said. "Material
effect" is a term that refers to how military service impacts
people's lives and their ability to meet their obligations.
"Essentially, this means that
service members entering active duty must be able to show their
military income is less than their pre-service income and that the
loss affects their ability to meet financial obligations,"
Griese said.
Regardless of profession -- doctor,
pilot, electrician, teacher, plumber, construction worker -- a
"material effect" can be claimed if active duty service
causes a loss of income.
This protection is most widely used
by reserve component service members called to active duty for long
deployments, such as during the Gulf War, Bosnia operations, etc., Griese said.
"A professional person in the
Guard or Reserve who is called to active duty is more likely to show
a loss of income," Griese said. Members whose income increases
with active duty would not qualify for the interest rate cap.
She emphasized that obtaining an
interest rate reduction requires service members to notify their
creditors and mortgage lenders in writing of their intent to invoke
the 6 percent rate cap. Notification must include proof of
mobilization and placement on active duty status, as well as
documentation of reduced income, such as a leave and earnings
statement.
The interest rate reduction is only
temporary. Griese said reserve component service members activated
for a six-month deployment to Bosnia, for example, would be required
to notify their creditors once their active duty service ends. The
interest rate prior to deployment then would be reinstated.
Civil Proceedings
The term "material effect"
also refers to the overall protection of service members' rights in
civil proceedings, Griese said. Service members involved in civil
litigation can request a delay in proceedings if they can show their
military responsibilities preclude their proper representation in
court. This provision is most often invoked by service members who
are on an extended deployment or stationed overseas, Griese said.
She is quick to point out that the
act is one of the most powerful and protective tools service members
have in asserting their rights under the law while on active duty.
"It has stood the tests of time
and court challenges, all the way to the U.S. Supreme Court,"
she said. "Service members could not ask for better protection
than what this act provides."
Service members who encounter
personal, financial, or legal problems should contact their unit or
installation legal assistance office to see if they're protected by
the Soldiers' and Sailors' Relief Act of 1940.
History
It has a date of 1940. But the
origins of the Soldiers' and Sailors' Relief Act of 1940 can be
traced back all the way to the Civil War.
According to Air Force Maj. Amy
Griese, assistant director for legal policy in DoD's officer of
Personnel and Readiness, and an expert on the subject, many of the
present-day provisions were first enacted early during the Civil War
when Congress passed a total moratorium on civil actions brought
against Union soldiers and sailors. In basic terms, civil litigation
involving soldiers or sailors was put on hold until they returned
from the war. Examples of civil matters included breach of contract,
bankruptcy, foreclosure or divorce proceedings.
Congress' intent was to protect the
national interests and those of service members. First, it wanted
service members to fight the war without worrying about problems
that might arise at home. Second, most of the soldiers and sailors
were not well paid, so it was difficult for them to honor
pre-service debts such as mortgages or other credit.
Congress again protected the rights
of service members during World War I with the Soldiers' and
Sailors' Relief Act of 1918. Griese explained that, like the Civil
War-era moratorium, the 1918 legislation protected service members
until it expired shortly after the war. The 1918 version offered
only a partial moratorium on civil actions, but did protect service
members from such things as repossessions, bankruptcy and
foreclosures.
The present-day statute, passed in
1940 to protect the millions of service members activated for World
War II, essentially re-enacts the 1918 law -- except Congress gave
it no provisions for expiration. Thus, since 1940, service members
have received uninterrupted protection. Indeed, congressional
commitment and support has remained so strong that the act has been
amended more than 11 times since 1940 to keep pace with a changing
military and changing world. In fact, the last amendments were added
only ten years ago, during the 1991 Gulf War.
50
U. S. Code Appendix, War and National Defense Act, Oct 17, 1940, CH.
888, 54 STAT. 1178
--End--
| 
