If a servicemember’s military obligation has affected his or her ability to pay off debts such as credit cards, loans, mortgages, or student loans, the servicemember can have his or her interest rate capped at 6 percent. The interest rate reduction only applies while the servicemember is on active duty, and any interest above six percent that would have been charged during that time is forgiven. The original interest rate will apply once the servicemember is no longer on active duty. To be eligible for this relief, the debt must exist before the servicemember’s activation date.
To request this temporary interest rate reduction, the servicemember must submit a written request to the creditor or lender with a copy of his or her military orders within 180 days of the servicemember’s termination from active duty.