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WASHINGTON-When the Servicemembers Civil Relief Act was signed into law in 2003, it was intended to clarify the 1940 Soldiers’ and Sailors’ Civil Relief Act. CUNA Director of Compliance Information Valerie Moss said it has and it has not accomplished that goal. “I think some of the confusion is because under the 1940 statute, the interest rate cap [and other provisions] automatically applied to them,” she explained for the military personnel’s part. “The credit union is in a better position now because of the notice requirement. It’s not as much of a guessing game.” The attorney explained that until the 2003 change members of the military or reserves called to active duty were not required to notify their financial institutions of their orders, though commanders were informally advising them to do so. Under the new SCRA, those called to active duty still have until 180 days after they return from active duty to let their credit union know, according to Moss. “That can sometimes be a nightmare,” she remarked, particularly on the collections end. If a member does not inform the credit union beforehand, they will proceed with their normal policy. “Collections issues have always been a concern when a member’s not present, do they.repossess a car?” Moss held up as an example. If a member returns and then notifies the credit union after the car is already gone, it can get sticky, but, Moss said, judges should be understanding of this scenario. Fortunately, she said, CUNA is mostly now hearing that credit unions are being informed ahead of time and higher-ups are still encouraging members of the military to notify their financial institutions before going on active duty. And, Moss added, “Most credit unions go above and beyond the call to duty to help their members.They `over-comply.’ ” There are a number of reasons the SCRA protection is afforded to military personnel: to help keep their minds focused on their mission, to compensate for reservists’ difference between their military and civilian pay, to allow them to defend themselves against foreclosure and other procedures. Once Navy Federal Credit Union receives a copy of the member’s orders and validates the accounts, the credit union provides “ any relief that is due,” according to Assistant Supervisor of Loan Servicing Kevin Midkiff. “A lot of the confusion that members have might be a result of getting second-hand information,” he said. Navy Federal spokesperson Loren Carson explained that often military personnel do not attend on-base seminars regarding SCRA and receive the information instead from a colleague who attended. She added that there are also command financial specialists who can advise the troops on financial matters. While Navy Federal is not actively encouraging members to attend these seminars, the branch offices on base do provide support to the financial seminars as requested. Navy Federal currently has 1,025 active participants under the SCRA protections. Navy Federal saw a net increase of more than 1,700 in 2001. As troops are being sent home from Iraq and Afghanistan the numbers are declining. So far in 2006, 13 members have activated their SCRA protections while 716 are expected to be released from active duty. “In the loan services section, we have four people who are dedicated to SCRA,” Navy Federal Supervisor of Loan Servicing Susan Hansen said. These people massage the applicants’ forms through the process. Navy Federal’s compliance department ensures that procedures are in line with the law. Since the wars, CUNA has fielded calls and e-mails from credit unions inquiring about their obligations in waves, CUNA’s Moss said. She joked that she could tell troop movements before they were announced on the news by the number of calls CUNA got on SCRA. The “ebb and flow” of requests in recent years are also determined by various credit unions’ fields of membership and other factors. CUNA, as a trade association, cannot offer legal advice. What the attorneys there can do is tell members exactly what the law says and offer examples of similar situations and how they were resolved. Aside from live staff, CUNA also offers a number of other sources for information, such as its E-Guide including a summary and frequently asked questions, Servicemembers Civil Relief Act: A Compliance Guide for $19.95, and courses are part of its RegTRAC compliance certification school. -

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