Qualifying Military Families Can Receive 6% Interest Rates for Credit Cards and Loans

Qualifying Military Families can Receive 6% Interest Rates for Credit Cards and Loans

Many military families struggle to make ends meet when family members are called into
active duty. To help these families stay afloat while making huge sacrifices, the Servicemembers
Civil Relief Act requires most creditors such as credit card issuers and mortgage lenders to cap
interest rates at 6% on pre-service debt for active service members. The portion above 6% is
permanently forgiven.

The Servicemembers Civil Relief Act applies if the servicemember takes a pay cut to fulfill the
military obligation which materially affects the ability to pay debts and obligations. The purpose
is to suspend or postpone some civil obligations so that the military member can devote his or her
full attention to military duties. This helps ease the financial strain and allows the family to
still be able to pay bills such as credit card, mortgage and loans. The debt must have been incurred
before he/she was called into active duty. The standard rates will apply if the credit card or loan
was applied for after the call for active duty.

"Military families make so many sacrifices and many make less then they can earn as a civilian.
Expenses can quickly exceed income and add to the stress. Taking advantage of the 6% rate for all
eligible loans can help prevent problems with debt," says Bill Hardekopf, CEO of LowCards.com.
"However, the creditors are not checking to see if you have a family member currently serving and
then charitably lower your rates. You have to contact them and make it happen."

To get the interest rate cap, provide the creditor with a notice of military order calling for
military service. After the creditor receives the notice, it must lower the rate to a maximum of 6%.
It must be effective the first day of active duty and is retroactive if received late. The monthly
payment must also be reduced by the amount of interest saved during the covered period.

Every military family should find out if they qualify, then check their loans and credit cards to
take advantage of the lower rates. However, receiving the lower rate is not automatic. To request
the lower rate, send the creditor a letter with a copy of the active duty orders and ask for an
immediate confirmation. If the servicemember qualifies, the creditor must lower the rate unless it
goes to court. In court it is up to the creditor, not the servicemember, to prove the ability to pay
has not been affected.

Reservists and members of the National Guard (when in active federal service) are included under
SSCRA.

There are also special allowances for income tax payments, rental agreements and protection from
eviction. Insurers may not decrease or restrict the amount of coverage, or require increased
premiums if the member enters active duty. Servicemembers should talk to their Legal Assistance
Attorney or accountant to learn about all of the benefits they may qualify for. Agents of the U.S.
Treasury and tax lawyers can also help families find the help and exemptions that apply.

LowCards.com ( http://www.lowcards.com ) is an independent website that helps consumers easily
compare credit cards in a variety of categories such as lowest rates, rewards/rebates, and lowest
intro rates. It also gives an unbiased ranking and review for each card. Created by Hampton &
Associates, the company has been analyzing the credit card industry and supplying objective websites
on various consumer expenses for over five years.

For more information, contact Bill Hardekopf at 1-800-388-1910 or billh@LowCards.com.