SCRA Notice informs borrowers, who are in default, of the mortgage and foreclosure related benefits and protections available to servicemembers and their dependents under the Servicemembers Civil Relief Act (SCRA). The notice intends to reach out to those servicemembers who are not aware of the benefits and protections under SCRA and give them an opportunity to exercise those rights. The notice is also known as the HUD-92070.
HUD requires lenders to send this notice to borrowers who are late in making payment. The requirement to send this notice became effective on effective June 5, 2006 in pursuance of 12 USC 1701x(c)(5)(A)(ii)(IV).
Servicemember Civil Relief Act (SCRA) entitles the servicemembers who are in military service to certain protections and benefits such as interest rate limitations, protections from default judgments and foreclosure, and evictions. SCRA is codified in 50 USC Appendix §§ 501 et seq.
The notice contains five sections:
You must provide the notice within 45 days from the date the missed payment was due unless the borrower pays the past-due amount before the expiration of the 45-day period. This notice is provided in addition to any other homeownership counseling notice.
The requirement to provide the SCRA notice applies to all residential loans where the borrower is in default. This includes conventional mortgages and HUD insured mortgages.
The contents of the notice are prescribed in the HUD-92070. You must customize the form by including your name, address, and contact information in the third section of the disclosure.
HUD has made changes in the past to reflect changes in regulations or to make corrections. Therefore, you should periodically visit the HUD Forms page to ensure you have the latest version of the form.
The notice is sent to all borrowers, irrespective of whether or not you are in the armed forces. The purpose is to reach out to those borrowers who are servicemembers in active duty status and are not aware of their rights under SCRA. Therefore, the notice would not apply to you if you are not a servicemember with the US armed forces.
Servicemembers who are in active duty should contact the lender to exercise their rights. The notice is received by you after you have missed a payment and the SCRA benefits may provide relief to you in the form of lower interest rate, lower payments, and/or foreclosure protection.
Updated: Jan 13, 2013