ARLINGTON, Va. — Creditors have to reduce interest rates on debts owed by any Guardsmen or reservists who get activated, according to a federal law that is designed to help servicemembers tapped to fight the nation’s wars.

The Soldiers’ and Sailors’ Civil Relief Act of 1940 protects military members from certain legal obligations while they are actively engaged in national defense.

Some of the act’s specific provisions include:

• Limiting interest rates to 6 percent for all debts incurred before beginning active-duty service. This provision includes interest rates on credit cards, mortgages and auto loans, but it does not apply to federal student loans.

• Protecting family members from eviction during times of active-duty service, regardless of whether the lease was signed before or after activation. If the monthly lease is $1,200 or less, a landlord must seek a court order to authorize an eviction.

• Prohibiting repossessions and foreclosures without court permission.

• Postponing civil lawsuits the servicemember is a direct party to, such as bankruptcy.

• Extending deadlines to file lawsuits by eliminating time served on active duty from calculating any statute of limitations.

• Protecting active-duty military from taxation by states other than by their state of domicile.

• Prohibiting creditors and insurance companies from making adverse credit reports, denying credit or taking adverse financial action against a servicemember based solely on invocation of the act.

But the law doesn’t kick in automatically. Individual servicemembers are responsible for notifying their creditors of the active-duty status and the member’s intent to invoke his or her civil relief act rights.

• Yet even though the law has been on the books for decades, some creditors are apparently still not getting it, according to defense department lawyers who are working to unsnarl violations of the rule that have left some reservists near bankruptcy.

In a case about to enter litigation, an Air Force reservist from California is facing the loss of his home, boat and personal business because the master sergeant’s creditors are threatening to foreclose on all his loans, just two months after he came off active duty.

The American Bar Association has agreed to represent him at no cost, Odom said. For more information on the Soldiers’ and Sailors’ Civil Relief Act of 1940, contact your local legal assistance office.

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