HUD reminds military personnel of their housing rights

Service members on active duty in Iraq and Afghanistan do not need to alert mortgage lenders of their military status in connection with a foreclosure, the Housing and Urban Development Department emphasized in a recent memorandum.

The 2003 Servicemembers Civil Relief Act affords mortgage relief, including a lower interest rate and foreclosure protection, to military personnel on active duty during war. The June notice from HUD stressed that once a service member requests mortgage relief, it is the lender's responsibility to determine the applicant's military status in connection with a foreclosure or other debt enforcement action.

"Although there is no requirement for service members to alert the lender of their military status in these situations, it is still a good idea for the service member to do so," the notice stated.

The law states that military personnel should not pay a mortgage interest rate above 6 percent during their service or one year thereafter. Also, a court can adjust any debt, or temporarily halt proceedings of any legal action taken to enforce a real estate debt filed during, or within nine months after, a service member's tour on active duty.

"Our military forces should not have to worry about losing their homes to foreclosure while serving their country on active duty," HUD Secretary Shaun Donovan said.

The Justice Department has been actively pursuing mortgage lenders who violate the Servicemembers Civil Relief Act. In May, two mortgage servicing companies settled complaints that they illegally foreclosed on military families' homes and set up a multimillion-dollar compensation fund for the affected families.