WASHINGTON (8/12/08)--Credit unions should be aware that a recently enacted housing law provides some immediate protection to servicemembers having trouble making mortgage payments, the Credit Union National Association (CUNA) has advised. The Housing and Economic Recovery Act was signed into law late last month. It is meant, in part, to mitigate burgeoning mortgage foreclosures in a stressed housing market. That new law amends the Servicemembers Civil Relief Act (SCRA) by:
* Offering nine months of protection (formerly 90 days) from mortgage foreclosures for returning servicemembers after they separate from active duty. This provision remains in effect until December 31, 2010; and * Extending the SCRA’s six percent interest rate cap for one year (formerly 90 days) beyond the period of military service if the debt is a mortgage, trust deed, or other security in the nature of a mortgage.
The new recovery law also requires the Department of Defense to implement a foreclosure-prevention counseling program for servicemembers returning from active duty abroad. Refer to the resource link below for more guidance on SCRA requirements.