Many of the biggest lenders in the United States are checking twice to make sure that their home-lending procedures have not broken a law that is designed to protect active service military personnel from foreclosure, The Wall Street Journal reports.
The review was prompted after J.P. Morgan Chase & Co. announced that an internal review discovered it had wrongfully foreclosed on 14 homes of active service military families. It was also found that they overcharged over 4,000 families on their mortgages. Now, the bank is refunding over $2 million to these families. The bank alleges some of the refunds were only for minor fees, and resolved quickly 13 of the 14 foreclosures. However, many people view the mistake as proof that the foreclosure system is troubled.
Under the Servicemembers Civil Relief Act (SCRA), loans for active duty service members cannot exceed a 6 percent annualized interest rate. The law also stops all foreclosure proceedings up until nine months after a service member comes back from active duty. Active duty is defined as full-time service, which includes training and tours. Anyone who knowingly breaks the law, faces fines and prison time. The 2003 SCRA law alleviates the burdens on active service military personnel who are serving the country during war, so that these individuals do not worry about the loss of a home while serving the country.
Major mortgage lenders in the U.S. report they haven’t yet uncovered problems like J.P. Morgan Chase. Also, many lenders have stated they are making sure they are in compliance with the law. Mortgage companies are also taking steps to ensure that military members are notified of possible future foreclosure issues, to prevent any future problems.
There are many complex laws surrounding foreclosure in the U.S. and in New Jersey. Home owners, at times, may feel like there is no place to turn during their time of crisis. If you are a New Jersey resident in the military that is facing foreclosure, contact The Law Offices of Robert Manchel. We can answer any questions you have and can advise you on your legal rights as a New Jersey home owner. Call 866-503-5655 today.