military loansMilitary Loans are available to people on active duty in the military, including reservists, as well as National Guard members who have been called up for active duty for more than 30 days. Military loans are available to you or a family member that has been called into active duty.

Immediately notify all your lenders (mortgage, car loans, credit cards, etc.). You must send them a copy of the military orders. Once the lender has been put on notice, it must reduce all interest payments to 6% , and most importantly forgive excess interest on pre-service debt that exceeds this 6% cap.

The reduction in the interest rate on military loans must be accompanied by a reduction of the monthly payment. The lender cannot require the same payment, crediting more toward principal instead. It should be pointed out that this protection applies only to debts contracted before the borrower went into active military duty. Debts contracted while on active service are not protected.

In addition to a break on mortgage and other debt payments, there are other important relief measures to the men and women in the armed services. Some of these provisions are complex; servicemembers with questions should consult with the legal assistance attorney assigned to their unit.

Military personnel, like their civilian counterparts, must continue to pay rent if a lease is not terminated. A personal life insurance policy cannot be terminated or be forfeited for nonpayment of premiums, or lapse while the insured in on active duty, plus one year.

On request by the military person, or in a judge’s discretion without a request, a court may stay or vacate any attachments or garnishments against the debtor during the period of active duty plus up to 90 days after that duty ends.

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