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Laws can protect returning military personnel

Overseas military duty, particularly in Iraq or Afghanistan, is tough enough. But coming home offers its own set of difficulties, from readjusting to family life to getting a handle on financial issues that cropped up during deployment.

While federal and state laws extend special consumer protections to members of the military on deployment, these protections are somewhat scattershot, poorly enforced and not widely understood by many military personnel or civilians, says Michael Spak, co-author of "Servicemember's Legal Guide: Everything You and Your Family Need to Know About the Law" and a professor at Chicago-Kent College of Law at the Illinois Institute of Technology.

"The military does a poor job of telling individual service people what their rights are and that they have access to a military attorney at no charge," says Spak.

Many enlisted service members are young, away from home and not very financially savvy when they are deployed, and don't take advantage of programs that allow them to knock interest down on credit charges, defer student loan payments, and temporarily avoid actions such as eviction and divorce proceedings, among others.

"Even if you're aware of the benefits you have when you deploy and return from deployment, they aren't always easy to understand, so many people don't take advantage of them," says Chris Michel, CEO of Military.com, a Monster.com Web site designed for active- and reserve-duty military personnel.

"The Internet has helped a lot, but you still need to take care of these matters before you leave because you likely won't get reduced interest on your loans if you don't write a letter to the lending companies documenting your situation, for example," he says.

Consumer protections
Many consumer protections for active-duty personnel and reservists have been in force since the Soldiers' and Sailors' Civil Relief Act was signed into law during World War I. It was re-enacted during World War II and modified during Operation Desert Storm. An updated law, the Servicemembers Civil Relief Act, was signed into law in December 2003.

Here's an overview of the provisions of this law, as well as other federal laws that aid service members:

Stays on civil litigation, including bankruptcy and divorce. Any service member currently on active duty can request a postponement of civil actions, including divorce and bankruptcy. This stay also applies to court-ordered judgments, wage attachments and garnishments.

The service member's commanding officer needs to write a letter to the court and the plaintiff's attorney stating that he or she is unavailable due to military commitments. These postponements expire once you are discharged from active duty or within 90 days of termination of active duty.

Reduction of loan interest. If you took out a loan prior to being activated as a member of the reserves or before you entered active-duty military service, you can have the interest on these loans reduced to 6 percent. This can include interest rates on credit cards, mortgages and even some student loans. The burden of proof is on the creditor to prove that active-duty service hasn't materially affected the consumer's ability to repay the loan at the original interest rate. Loan contracts that are signed once active duty begins aren't covered under this provision.

Eviction protection. Skyrocketing rents in many parts of the country had limited the effectiveness of lease termination and eviction protection provisions in the old law. Under the new law, service members and their families can't be evicted due to nonpayment of rent while on active duty on rental payments up to $2,400 a month. Any service member whose permanent-duty station is changed, or who is deployed for three months or longer from his or her permanent-duty station, can break a lease without penalty.

Next: "Members may obtain deferments of life insurance payments. ..."
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