Military servicemembers could get expanded protections from mortgage lenders under legislation to be introduced Tuesday.
Reps. Elijah Cummings, D-Md., Bob Filner, D-Calif., and Adam Smith, D-Wash., plan to submit an amendment to a defense spending bill being considered by the House this week. The amendment expands the Servicemembers Civil Relief Act to include more homeowners under the umbrella and to delay evictions for a longer period.
"Our troops fighting overseas in Iraq or Afghanistan should not have to fight here at home just to keep a roof over the heads of their loved ones," Cummings said. "This bill will expand current law to protect more of our brave men and women in uniform from losing their homes while they protect our freedoms abroad."
The amendment expands protection to servicemembers operating in support of contingency operations, which include national emergencies. Surviving spouses of military members who died in service will also be moved under the umbrella of the law, according to the amendment.
The broader protections will also include veterans considered disabled at the time of discharge, according to Defense Department and Veterans Affairs ratings. Often, a 100% disabled rating refers to veterans with severe amputees and receive 100% of a veteran benefits.
The amendment will stay a foreclosure against a servicemember for 12 months, an increase from nine months. If current protections expire at the end of the year, a foreclosure can only be delayed 90 days under SCRA.
The proposal also doubles penalties to lenders who violate SCRA. Under the amendment, a lender could face a $110,000 fine instead of the current $55,000 penalty for first violations. Subsequent violations could cost banks $220,000, up from $110,000.
It forces lenders to establish a special SCRA compliance officer and provide a toll-free number and website to assist these borrowers.
"Our servicemembers protect our country, our way of life and our homes," Filner said. "We can do no less to protect their homes against mortgage foreclosure."