The United States government developed laws specially designed to help military servicemembers, particularly during times when they’re on duty or deployed away from home. The Servicemembers Civil Relief Act (SCRA) provides many of these protections, including protection against foreclosure. Several states, like California, provide significant protection even beyond that included in the SCRA. (For more details about protections under the SCRA, see Legal Protections for America's Military: The Servicemembers Civil Relief Act)
The SCRA helps protect against the possibility of a servicemember losing a home while serving the country.
Loans originated before active duty. For pre-service loans, the SCRA prohibits lenders from foreclosing on, seizing, or selling the home of military personnel on active duty, unless the servicemember waives this protection or a court orders the foreclosure to proceed. This protection extends for a year following a servicemember's period of active duty. (50 U.S.C. App. § 533). (To learn more, see Foreclosure Protections & the Military: When a Servicemember Gets a Mortgage Before Active Duty.)
Loans originated after starting active duty. Courts cannot enter a default judgment (a court ruling when one party to a lawsuit fails to answer the suit or appear in court) against a military servicemember on active duty until an attorney has been appointed to represent that servicemember. This representation gives deployed servicemembers an advocate for their case when they cannot be present to speak for themselves. Furthermore, a court may halt proceedings for 90 days or more if it finds that the servicemember’s presence is critical for defending the case. (50 U.S.C. App. § 521). This protection can be essential when facing a judicial foreclosure, but typically doesn’t protect against nonjudicial foreclosures. (To learn more, see Foreclosure Protections & the Military: When a Servicemember Gets a Mortgage After Active Duty.)
The California legislature has broadened protection for military servicemembers beyond that found in the federal SCRA.
Perhaps most importantly, California law protects military servicemembers on active duty for the State of California, as well as those on federal active duty.
State duty protection is a crucial difference from the federal SCRA, which only protects servicemembers on federal active duty. Generally, a servicemember must serve on active duty for more than seven days in any 14-day period to be protected. (Cal. Mil. & Vet. Code § 400).
As with the SCRA, California law affords different types of protection depending upon whether the mortgage existed before active duty.
Loans originated before active duty. Most foreclosures in California are nonjudicial, which means no court involvement. For loans that originated before active duty, lenders can’t foreclose, seize, or sell real property while a servicemember is on active duty and for 90 days afterward, unless a court approves it or the servicemember agrees. For judicial foreclosures, the law also authorizes courts to stay (delay) foreclosure proceedings or take other reasonable action that is equitable to all parties. A court may order proceedings to move forward if it determines that a servicemember’s ability to pay has not been materially affected. (Cal. Mil. & Vet. Code § 408).
Loans originated after starting active duty. For judicial foreclosures, courts are authorized to stay proceedings against servicemembers on active duty and for up to 60 days afterward. As with the SCRA, California law does not typically protect servicemembers facing nonjudicial foreclosure for loans originated after active duty service. (Cal. Mil. & Vet. Code § 403).
Under California law, reservists may defer mortgage payments for the lesser of 180 days or the period of active duty plus 60 days if they give proper notice to the lender and meet other requirements. (If you have questions about whether you qualify for this protection, talk to an attorney). The mortgage term is extended by the length of the deferral so that the reservist isn’t required to make higher, combined monthly payments because of the deferral. (Cal. Mil. & Vet. Code §§ 800, 801).
Servicemembers can petition the court to defer payments for a period equal to the entire length of active duty, potentially much longer than the time frame defined above. However, the loan must have originated before active duty for the court to consider such a deferral. (Cal. Mil. & Vet. Code § 409.3).
California law provides extensive protection to servicemembers and their families in a wide variety of circumstances, including eviction, repossession, lease agreements, credit agreements, and more. Servicemembers facing financial hardship are encouraged to discuss how the law might apply to their specific challenges with an attorney, as discussed below.
Military servicemembers facing financial problems should speak to military defense counsel (a military attorney independent from the standard chain of command specially designated to represent servicemembers confidentially), or a California-licensed civilian attorney with experience in military law. The laws can be very complicated, and an attorney can help determine if the SCRA or California law will apply to specific situations.
Because financial difficulties can sometimes impact a military servicemember’s security clearance, or result in disciplinary or adverse administrative action, servicemembers should avoid initially contacting their base legal office. Judge Advocates General (JAGs), the military attorneys who work in the base legal office, serve in the normal chain of command at their base. Military defense counsel or a civilian attorney can provide confidentiality that can be critically important to maintaining a servicemember’s career.
Be sure to ask your attorney to look specifically at California state laws. Because military attorneys come from many different states, your military defense counsel might not be immediately aware of the additional protections that California provides.