Foreclosure Help for Troops Extended Until 2016

U.S. troops, especially reservists and National Guard members, who return from active-duty service will get a further break on avoiding foreclosure, as House and Senate lawmakers will agree to extend until the end of 2015 protections for military members that prevent a bank seizure on their home for a year after they complete active duty.

The extension was agreed upon by both houses as part of a last-minute wrap-up of a $1.1 trillion package of government spending. It will extend for another year protections that were originally incorporated into the Servicemembers Civil Relief Act (SCRA) in 2008, which were lengthened from 90 days after returning from active duty to nine months, so long as the member took out the mortgage prior to active duty.

That extension was lengthened again to one year in 2012 with a measure sponsored by Sen. Sheldon Whitehouse, a Rhode Island Democrat, who earlier this year introduced a measure to make the one-year-long foreclosure prohibition period permanent. The 2012 provision however, would have expired at the end of December 2014, reducing the foreclosure protection period after active duty concluded back to the pre-2008 level of just 90 days.

While foreclosure and auction of service member’s homes was already precluded while troops were on active duty, a permanent extension of protections up to one year after their return is particularly sought after by National Guard and Reserves members who often have to give up higher-paying full-time jobs to honor their military commitments with call-ups for active duty.

The SCRA also provides protections against repossessions of personal property, such as automobiles, while a service member is on active duty, as well as protections and extensions against some rental evictions for up to three months, while allowing service members to opt out of leases or rental agreements sometimes without penalty.

By: Daniel Goldstein