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View Full Version : Members of the Armed Forces Are Protected From Creditors Hunting Them Like Jackals


Amnorix
03-28-2005, 10:41 AM
There is a very interesting article in the NY Times today about how a number of companies and other creditors are illegally chasing after members of the armed forces, often reservists who have been called to active duty. For the most part, it seems like it's done out of ignorance, either of the status of the individuals as members of the military, or of the federal law that protects them. It seemed like I should post this so that if anyone knows a member of the armed forces having trouble with this, they could take appropriate steps.

"The law, the Servicemembers Civil Relief Act, protects all active-duty military families from foreclosures, evictions and other financial consequences of military service."

Note also that the law provides that:

1. creditors can't seize assets (i.e. car reposession) without a court order (not normally required);

2. that landlords must release a member of the military who is forced to break a lease as a result of being called up.

3. judges cannot declare a member of the military in default without first appointing an attorney to represent their interests.

4. pre-military debts (CREDIT CARDS TOO) get capped at 6% interest rate if/when you get called up.

"Military lawyers, credit industry organizations and some state courts and bar associations have also tried to spread the word about the new law. But these efforts are not enough, said Col. John S. Odom Jr., retired, of Shreveport, La., who is a specialist on the act. "What we need is a way to reach Joe Bagadoughnuts in Wherever, Louisiana," he said. "Because that's where these cases are turning up."

Obviously, my summaries above are just simplifications of a complex law designed to cover many situations that cause members of the military financial distress as a result of their being called to serve their country. In any event, this gives you an idea, so if you can spread the word to Joe Bagadoughnuts in Wherever, Louisiana....

BigMeatballDave
03-28-2005, 11:01 AM
Good...

Saggysack
03-28-2005, 11:17 AM
Them bastards have been preying on military members for decades. When I was stationed at Ft. Benning there were places all over willing to give any military member credit at outlandish % rates. There was one place, I forget the name of it, Easy loans, Payday Loans, something along those lines. If a military member went in there for $1000 dollar loan they would end up paying off that loan in $150 payments for 10 months. Car lots were just as bad. A green soldier just out of basic doesn't know jack shit. They go down buy a car, take a loan, set up a AAFES credit account and max it out. And before they know it they are in debt up to their ears with interest rates that would kill a millionaire. Those bastards take advantage of military members because they know the money comes every 1st and 15th.

It was no surprise all these shady places are 95% in one area. With the tittie bars, car lots and check cashing places.

Mark M
03-28-2005, 11:27 AM
The act in the article, the Servicemember's Civil Relief Act (formerly the Soldier's and Sailor's Relief Act of 1940) protects those who have been called up to active duty.

Basically, any debt incurred prior to military service can be reduced to a max interest rate of 6%. There are also a number of rules governing foreclosures and legal actions.

The key is that the service member must invoke hisher SCRA protections and prove that his/her ability to pay has been "materially affected" by military duty. Lenders do not have to just give the rate to anyone who serves.

Trust me ... I've read the law and written several articles on it. :)

Also, Sam Grabes (R-Mo.) has put forth H.R. 97, a bill that seeks to limit the interest rate for service members to 36% (most payday places charge as much as 700% when factored as APR).

If anyone wants to know more, just let me know.

MM
~~:D

Amnorix
03-28-2005, 11:42 AM
Trust me ... I've read the law and written several articles on it. :)


Interesting. Are you an attorney? If so, I didn't know that.

Mike Grose
03-28-2005, 11:44 AM
I'll never forget the carlots just off-base that would sell cars 10-15 times each. Sell car @ 25-50% interest. Repo car. Sell again.

Mark M
03-28-2005, 11:45 AM
Interesting. Are you an attorney? If so, I didn't know that.

Nope. I'm a writer for a financial service company that works exclusively with military personnel.

Our company (or, rather, I) wrote an article for the Georgia Industrial Loan Association, have composed several letters to the editor and a white paper about the SCRA.

Hell, at this point I know more about it than our legal staff.

MM
~~:shrug:

Tuckdaddy
03-28-2005, 11:55 AM
When I've been deployed I've always gotten my bills taken care of. After I got married it was no problem obviously. This problem runs amuk with young single soldiers. They don't have someone at home paying the bills.

Amnorix
03-28-2005, 01:03 PM
Nope. I'm a writer for a financial service company that works exclusively with military personnel.

Our company (or, rather, I) wrote an article for the Georgia Industrial Loan Association, have composed several letters to the editor and a white paper about the SCRA.

Hell, at this point I know more about it than our legal staff.

MM
~~:shrug:

I have no doubt. Interesting.

Boozer
03-28-2005, 01:10 PM
Them bastards have been preying on military members for decades. When I was stationed at Ft. Benning there were places all over willing to give any military member credit at outlandish % rates. There was one place, I forget the name of it, Easy loans, Payday Loans, something along those lines. If a military member went in there for $1000 dollar loan they would end up paying off that loan in $150 payments for 10 months. Car lots were just as bad. A green soldier just out of basic doesn't know jack shit. They go down buy a car, take a loan, set up a AAFES credit account and max it out. And before they know it they are in debt up to their ears with interest rates that would kill a millionaire. Those bastards take advantage of military members because they know the money comes every 1st and 15th.

It was no surprise all these shady places are 95% in one area. With the tittie bars, car lots and check cashing places.

No joke. I just read an article that was submitted discussing this phenomenon. The density of these loan sharks around military bases compared to surrounding areas is astounding. States really need to dust off their criminal usury laws and get crackin'.

Mark M
03-28-2005, 01:14 PM
No joke. I just read an article that was submitted discussing this phenomenon. The density of these loan sharks around military bases compared to surrounding areas is astounding. States really need to dust off their criminal usury laws and get crackin'.

Would that be the study done by Univ. of FL and CalState-Northridge?

The numbers are really frightening, and not just around military bases. Poor areas are also huge targets for predatory douche bags.

The saddest part is that these places prey on those with little fiscal knowledge. They're so good at it that Americans paid $3.4 billion in payday loan fees last year alone.

MM
~~:eek:

Boozer
03-28-2005, 01:33 PM
Would that be the study done by Univ. of FL and CalState-Northridge?

The numbers are really frightening, and not just around military bases. Poor areas are also huge targets for predatory douche bags.

The saddest part is that these places prey on those with little fiscal knowledge. They're so good at it that Americans paid $3.4 billion in payday loan fees last year alone.

MM
~~:eek:

Yes, actually it was. I don't have the final say, but it might be appearing in the Kansas Law Review.

Duck Dog
03-28-2005, 01:38 PM
I used the SSA for a divorce. Well, I used it to make that biatch wait until I got home.

15 months.