Discover Bank provides many of the benefits that are required under the Servicemember’s Civil Relief Act (SCRA). This act was put in place to help servicemembers with financial problems by restricting the terms, fees, and interest rates that can be charged on rental agreements, home mortgages, automobile loans, and many other common financial instruments, including credit cards.
The SCRA explicitly states that when service members are on active duty, no interest above 6 percent can accrue for past credit obligations. That excess interest above 6 percent is permanently forgiven. Additionally, the monthly payment must be reduced by the amount of interest saved during the covered period.
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Table of Contents
SCRA Eligibility:
The Discover Bank SCRA benefits are available to all active duty service members and their spouses/domestic partners on joint accounts. To qualify, the service member must have served in one of the following U.S. military branches:
- Army
- Navy
- Air Force
- Marine Corps
- Coast Guard
- Reservists and members of the National Guard
- Commissioned Officer of the Public Health Service or the National Oceanic and Atmosphere Foundation
Benefits of SCRA:
- Expands current law that protects service members and their families from eviction from housing while on active duty due to nonpayment of rents that are $3,329.84 per month or less for 2015, this amount changes every year.
- Provides a service member who receives permanent change of station orders or who is deployed to a new location for 90 days or more the right to terminate a housing lease.
- Clarifies and restates existing law that limits to 6 percent interest on credit obligations incurred prior to military service or activation, including credit card debt, for active duty service members. The SCRA unambiguously states that no interest above 6 percent can accrue for credit obligations (that were established prior to active duty or activation) while on active duty, nor can that excess interest become due once the service member leaves active duty – instead that portion above 6 percent is permanently forgiven. Furthermore, the monthly payment must be reduced by the amount of interest saved during the covered period. Note: This law only covers debt incurred prior to military service.
- Allows you to terminate a cell phone contract if you relocate for at least 90 days to a location that does not support your cell phone service.
- Allows you to terminate a vehicle lease you signed prior to joining the armed forces if you enter military service under a call to duty on orders of 180 days or more. You may also terminate a vehicle lease if you receive PCS orders to an OCONUS location or deploy OCONUS for at least 180 days.
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Bottom Line:
Being able to avoid credit card fees and high interest charges as a result of the Discover Bank SCRA benefits can save you and your family hundreds of dollars every year! If you’re a former or active duty service member, you should definitely take advantage of this opportunity because you deserve financial freedom.
Just log into your Discover account and talk to customer service about the benefits that you can receive from the SCRA. If you are interested in more offers, check out all of the Discover Bank Promotions!
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SCRA Rules apply to ALL lenders. There is nothing special about this at Discover