Summary Of Key Statutory Provisions Affecting Service Members And Veterans

 

FEDERAL

STATE

 

Service Members Civil Relief Act ("SCRA")
(50 U.S.C. §§ 501-597b)

 

 


Applies to Service members

NYS Soldiers' and Sailors' Civil Relief Act (NY Military Law §§ 300-328)

 

 


Applies to Service members

Interest Rate Cap

Interest rate on mortgage payments, credit cards, and other obligations may be capped at 6% (if service materially affects the member's ability to pay).

  • For mortgages, this cap remains in effect during the period of military service and one year thereafter.

 

  • For other obligations, the cap remains in effect during the period of military service.

(Section 527).

During military service, interest on obligation or liability incurred before service capped at 6%. (Section 323-a)

Foreclosure

Mortgage lenders may not foreclose, or seize property for failure to pay a debt, while a service member is on active duty or for 9 months grace period prior to December 31, 2012 unless they have the approval of a court. (Section 533).

After December 31, 2012, a court order is required prior to a foreclosure, sale or seizure of property while the service member is on active duty or within 90 days after active duty.

With respect to property owned prior to commencement of military service, court may stay proceedings to enforce obligations for non-payment. No sale, foreclosure, or seizure of property for non-payment shall be valid during period of military service or six months after, unless upon court order. (Section 312).

Residential and Other Leases/Eviction

After executing a lease, a person who enters military service or a service member who receives permanent change of station orders or who is deployed to a new location for 90 days or more have the right to terminate a lease for residential, professional, business, agricultural or similar purpose upon written notice to the landlord.

Termination is effective 30 days after the next rental payment is due (if lease provides for monthly payment of rent) or the last day of the month following the month in which notice is given. (Section 535)

May not evict service member or family for nonpayment of rent from home occupied as primary residence when the rent does not exceed a certain amluntadjusted annually, except by court order. (Section 531).

 

After military service begins, allows for termination of a lease upon proper notice, effective thirty days after next rental payment due or last day of the following month (depending on the type of lease). (Section 310)

No eviction during period of military service except upon leave of court. (Section 309)

Motor Vehicle Lease Contracts

Automobile leases may be terminated when a service member receives permanent change of station orders or is deployed to a new location for 180 days or more. 

Termination is effective when the vehicle is returned, not later than 15 days after delivery of written notice to lessor of termination. (Section 535).

After military service begins, lease can be terminated upon notice and effective 30 days after first date on which next lease payment is due and payable after notice delivered, or the vehicle is returned to the lessor, whichever is later. (Section 311-a)

Telephone Contracts

Telephone contracts, including contracts for cellular telephone service, may be terminated via written or electronic notice when a service member is ordered to relocate for 90 days or more to a location that does not support the contract. (Section 535a).

 

Installment Contracts

A contract by a service member for the purchase of real or personal property, including a car, or the lease or bailment of such property may not be rescinded or terminated for breach of contract occurring before or during military service, and such property may not be repossessed without a court order. (Section 532).

After military service begins, cannot exercise right or option to rescind or terminate contract or resume possession of property for nonpayment of any installment or for breach of the terms occurring prior to or during military service, except through court action. (Section 311)

Other rental contracts

 

After military service begins, service member entitled to, upon meeting certain notice requirements, cancel contract at no penalty and with full refund of any moneys placed on deposit. (Section 311-b)

Life Insurance

A service member may have the Dept. of Veteran Affairs guarantee payment on certain types of commercial life insurance policies for the period of military service and for two years after that. (Sections 541 - 549)

No life insurance policy of a member of a reserve component of the armed forces who is called to active duty, or policy which has been brought w/I the benefits of the federal SSCRA, shall lapse or be forfeited for nonpayment of premium during period of service, or during two years after expiration of that period; also addresses individual accident and health insurance policies for members of state organized militia. (Section 316); Protection for assignor of life insurance policy. (Section 316-a).

Health Insurance

Service Members are entitled to have their civilian health insurance reinstated when they return to civilian life following periods of active duty. (Section 594).

No individual accident and health insurance policy which insures a member of the organized militia of the state shall lapse or be forfeited for non-payment during period of 60 days from date that member begins active duty if appropriate notice furnished. (Section 316).

Contract Penalties

If a service member fails to perform an obligation arising under a contract and a penalty is incurred arising from that nonperformance, a court may reduce or waive the fine or penalty if (1) the service member was in military service at the time the fine or penalty was incurred; and (2) the ability of the service member to perform the obligation was materially affected by such military service. (Section 523).

When action for contract compliance stayed, no fine or penalty shall accrue for failure to comply with contract during period of stay. (Section 305).

Impact on Certain Future Financial Transactions

Application pursuant to this statute for stay, postponement or suspension of tax, fine, penalty, insurance premium or other civil obligation alone shall not provide basis for: determination that person unable to pay; denial or revocation of credit, change of terms of existing credit arrangement, refusal by creditor to grant credit in substantially same amount/terms; adverse credit report; change in insurance terms. (Section 518).

Application pursuant to this statute for stay, postponement or suspension of tax, fine, penalty, insurance premium or other civil obligation or liability alone shall not provide basis for: determination that person unable to pay; denial or revocation of credit, change of terms of existing credit arrangement, refusal by creditor to grant credit in substantially same amount/terms; adverse credit report; refusal to insure. (Section 313-a).

 

 

 

Storage Liens

Without a court order, a person holding a lien on the property or effects of a service member may not, during any period of military service and for 90 days thereafter, foreclose or enforce any lien on such property or effects. (Section 537)

No person shall exercise any right to foreclose or enforce any lien for storage of household goods, furniture, or personal effects of a person in military service during such person's period of military service and for three months thereafter except upon court order. (Section 316-a)

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