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Financial Services Law Insights and Observations

Servicemember Files Writ of Certiorari, Petitions Supreme Court to Review SCRA Protections for Non-Judicial Foreclosures

Courts U.S. Supreme Court SCRA Foreclosure

Courts

On October 11, a servicemember filed a petition for a writ of certiorari, requesting that the U.S. Supreme Court review an opinion issued by the U.S. Court of Appeals for the Fourth Circuit concerning whether the Servicemembers Civil Relief Act (SCRA) can be applied to a mortgage loan obligation incurred during a borrower’s earlier, distinct period of military service. (See previous InfoBytes summary on Fourth Circuit opinion.) 

Under the SCRA, servicemembers are afforded certain protections against non-judicial foreclosures of their home while in active military service. Section 3953 provides that a home mortgage “originated before the period of the servicemember’s military service and for which the servicemember is still obligated” cannot be foreclosed upon unless allowed by a court order. However, the appellate court affirmed the district court’s decision in favor of the bank, concluding that because the servicemember “incurred his mortgage obligation during his service in the Navy, the obligation was not subject to SCRA protection” even through the servicemember, after a discharge period, later re-enlisted with the Army.

The petition argues that the appellate court “misconstrued” and narrowly interpreted the SCRA’s definition of the term “period of military service” under section 3911 by treating the servicemember’s “separate and distinct periods of military service as a single period of service.”

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