A Law Gets Lost: Some Creditors Make Illegal Demands on Active-Duty Soldiers

Some families of men and women serving overseas are getting screwed over by banks and other creditors who are trying to collect on debts, and in some cases threatening foreclosure on mortgages. This is in direct violation of a law passed in 2003 which protects soldiers and their families. From the article in the NY Times:

"The law, the Servicemembers Civil Relief Act, protects all active-duty military families from foreclosures, evictions and other financial consequences of military service. The Supreme Court has ruled that its provisions must "be liberally construed to protect those who have been obliged to drop their own affairs to take up the burdens of the nation."

Yet the relief act has not seemed to work in recent cases like these:

¶At Fort Hood, Tex., a soldier's wife was sued by a creditor trying to collect a debt owed by her and her husband, who was serving in Baghdad at the time. A local judge ruled against her, saying she had defaulted, even though specialists say the relief act forbids default judgments against soldiers serving overseas and protects their spouses as well.

¶At Camp Pendleton, Calif., more than a dozen marines returned from Iraq to find that their cars and other possessions had been improperly sold to cover unpaid storage and towing fees. The law forbids such seizures without a court order.

¶In northern Ohio, Wells Fargo served a young Army couple with foreclosure papers despite the wife's repeated efforts to negotiate new repayment terms with the bank. Wells Fargo said later that it had been unaware of the couple's military status. The foreclosure was dropped after a military lawyer intervened."