Mortgages Analyzed
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SCRA Notice

What is SCRA Notice?

SCRA Notice

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).

About SCRA

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.

Source :www.MortgagesAnalyzed.com

Contents of SCRA Notice

The notice contains five sections:

  1. Legal Rights and Protections Under the SCRA: This section contains the statement that active duty servicemembers have protections under SCRA.
  2. Who May Be Entitled to Legal Protections Under the SCRA?: This section identifies categories of members of armed forces who are eligible SCRA protections. As a borrower, if you do not meet the SCRA eligibility criteria (active duty servicemember) then you may ignore the rest of the disclosure. If you are a servicemember who is not sure if you are covered or not, then you should reach out to the resources listed in the last section.
  3. What Legal Protections Are Servicemembers Entitled To Under the SCRA?: This section contains a brief summary of the SCRA protections applicable for mortgage and foreclosure.
  4. How Does a Servicemember or Dependent Request Relief Under the SCRA?: This section identifies the steps that a servicemember must take to exercise their SCRA protections.
  5. How Does a Servicemember or Dependent Obtain Information About the SCRA?: This section identifies military resources that a servicemember can utilize to obtain more information on SCRA.
Source :www.MortgagesAnalyzed.com

Lender's Consideration

When to Send the SCRA Notice?

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.

Which Loans Does SCRA Notice Apply?

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.

Include Contact Information in the SCRA Notice Before Sending

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.

Source :www.MortgagesAnalyzed.com

Borrower's Consideration

Notice is for Servicemembers Only

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.

Source :www.MortgagesAnalyzed.com
 

Document Summary

 
SCRA Notice
Purpose
SCRA Notice informs borrowers, who are in default, of the mortgage and foreclosure related benefits and protections available to servicemembers and their dependents under SCRA.
Use in Mortgages
SCRA 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.
Other Names
  • SCRA Notice
  • SCRA Notice Disclosure
  • Servicemembers Civil Relief Act Notice Disclosure
  • HUD-92070
  • HUD Form 92070
  • SCRA Homeownership Counseling Notice
Type
Disclosure
Provided By
Lender/Servicer
Provided To
Borrower
Notarization Required
No
Signed By
None
Life Cycle Stage
Servicing
Recordkeeping
Lender/Servicer should maintain the record of mailing the disclosure.
Model Form
HUD-92070 (02/2013)
Applicable Laws
  • 12 USC 1701x(c)(5)(A)(ii)(IV)
  • HUD Mortgagee Letter 2006-28
Source :www.MortgagesAnalyzed.com

Updated: Jan 13, 2013

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