V. Lending — SCRA
Termination of an automobile lease also includes the return of the automobile to the lessor within 15 days after delivery of the written notice of termination.
Termination is permitted of pre-service “residential, professional, agricultural or similar” leases occupied or intended to be occupied by a servicemember or a dependent as well as those leases executed during military service where the servicemember subsequently receives orders for a PCS or a deployment for a period of 90 days or more.
Foreclosure, Eviction from Bank-Owned Property
Real or personal property owned by a servicemember before the servicemember’s military service that secures a mortgage, trust deed, or similar security interest cannot be sold, foreclosed upon, or seized based on a breach of such a secured obligation during the period of military service or 9 months thereafter without a court order. Additionally, in an action filed during or within 9 months after a servicemember’s military service, a court may, after a hearing on its own, or shall, upon application by a servicemember, stay a proceeding to enforce an obligation as described above or adjust the debt, when the member’s ability to comply with the obligation is materially affected by reason of the member’s military service.6
A landlord may not evict a servicemember or his or her dependents from certain residences7 occupied primarily as a residence during a period of military service except by court order.
Life Insurance Assigned as Security
If a life insurance policy on the life of a servicemember is assigned before military service to secure the payment of an obligation, the assignee of the policy (except the insurer in connection with a policy loan) may not exercise, during the period of the servicemember’s military service or within one year thereafter, any right or option obtained under the assignment, absent compliance with a court order or other specified requirement.
The fact that a servicemember applies for, or receives a stay, postponement, or suspension of his or her obligations or
Section 303 of the SCRA, 50 U.S.C. app. 533, as amended by Section 2203(a) of the HERA.
The law as originally passed by Congress applied to dwellings with monthly rents of $2,400 or less. Accordingly, evictions involving residences with monthly rents of $2,400 or less needed a court order. This amount is adjusted yearly and is published in the Federal Register by the Department of Defense. The figure as of January 1, 2008, is $2,831.13. This annual adjustment is generally announced in February.
liabilities pursuant to the SCRA may not in itself provide the basis for the following:
A determination by a lender or other person that the servicemember is unable to pay the obligation or liability in accordance with its terms;
A creditor’s denial or revocation of credit, change in terms of an existing credit arrangement, or refusal to grant credit to the servicemember in substantially the amount or on substantially the terms requested;
An adverse report relating to the creditworthiness of the servicemember by or to a consumer reporting agency;
A refusal by an insurer to insure the servicemember;
An annotation in a servicemember’s record by a creditor or a person engaged in the practice of assembling or evaluating consumer credit information identifying the servicemember as a member of the National Guard or a reserve component; or
A change in the terms offered or conditions required for the issuance of insurance.
Relief for Other Obligors
Whenever a court grants a stay, postponement, or suspension to a servicemember on an obligation, it may similarly grant a person primarily or secondarily liable such a stay, postponement, or suspension.
Determine the institution’s compliance with the provisions of the SCRA, as applicable, to the institution’s product offering and operations, including management of other real estate owned where a servicemember or his/her dependents may be tenants.
Assess the quality of the institution’s compliance risk management systems and its policies and procedures for implementing the provisions.
Determine the reliance that can be placed on the institution’s internal controls and procedures for monitoring the institution’s compliance with the provisions.
Determine corrective action when violations of law are identified or when the institution’s policies or internal controls are deficient.
Examination Procedures General
1. Through discussions with management and review of available information, determine whether the institution’s internal controls are adequate to ensure compliance with the SCRA. Consider:
policies and procedures
FDIC Compliance Manual — June 2009