Thursday, February 17, 2011

ROA Concerned Over Failures to Protect Student Veterans Rights

The Reserve Officers Association has found a little-known public law protecting student veteran rights may be being ignored by financial institutions.

Since Aug. 14, 2008, federally guaranteed student loans have been subject to the Servicemembers Civil Relief Act’s (SCRA) 6 percent interest rate cap upon mobilization. Students must request interest rate reductions upon mobilization. Those students unaware of this 2-year-old provision may be losing out on a significant benefit. Likewise, loan officers may not be aware of the relatively young law either.

Individuals calling into the Service Member’s Law Center, a service of ROA, recently have questioned loan officer statements that SCRA’s 6 percent interest rate reductions do not apply to student loans. Prior to 2008, Section 527 of SCRA did not protect students; however Public Law 110-315 changed that.

The purpose and effect of this 2008 amendment was to make the SCRA 6 percent interest rate cap applicable to student loans, just as it applies to credit cards, automobile loans, and other financial obligations.

“Given the niche of people this law affects, the Service Members Law Center still helps about ten people a month on the SCRA interest rate issue,” said Capt. Samuel Wright, a retired Navy lawyer and director of the Law Center.

The Service Members Law Center provides free information regarding laws on employment, voting rights and other legal issues primarily pertaining to the citizen warriors of the Reserve Components.

“This was a very important change,” said Wright. “For many National Guard and Reserve members, the student loan debt will be the most significant financial obligation for which the member will need relief upon call to active duty. We need to get the word out there to both students and banks to take advantage of this law.”

A complete copy of the Servicemembers Civil Relief Act with all of its amendments and changes included as of the end of the 111th Congress can be found by visiting

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