MUFG complies with the Federal laws that protect our military servicemembers
"Financial burdens can undermine military readiness, damage the morale of servicemembers and their families, and add to the cost of maintaining an effective all-volunteer military defense force.” — United States Department of Defense
Over the past several years, safeguarding servicemembers from predatory lending practices and increasing their financial protection has been a focus of the legislators on Capitol Hill, the Department of Defense, the Consumer Financial Protection Bureau and banking regulators such as the Office of the Comptroller of the Currency. At the Federal level, protecting servicemembers is regulated by two primary laws, the Servicemembers’ Civil Relief Act (SCRA) and the Military Lending Act (MLA). In addition, many states have gone above and beyond the federal law in implementing additional protections and/or benefits to servicemembers.
MUFG is committed to honoring America’s military personnel and to ensuring the requirements and privileges under the law are fully extended to them, their spouses, partners, and qualifying dependents (and in many cases, benefits are more generous than those mandated by the military statutes). Our Servicemember Lending Program ensures that we comply with these laws.
About the Servicemembers’ Civil Relief Act
The SCRA, enacted in 2003 and amended several times since then, revised and expanded the Soldiers’ and Sailors’ Civil Relief Act of 1940. The SCRA is a law designed to protect servicemembers of the Army, Navy, Air Force, Marine Corps, and Coast Guard (as well as Reservists and National Guard personnel) who are on active duty, as well as commissioned officers of the Public Health Service and the National Oceanic and Atmospheric Administration on active service. The SCRA also provides protections to a servicemember’s spouse and dependents.
The SCRA provides eligible active duty service members with financial protections and benefits on the loan and lease obligations they may have incurred prior to entering active duty military service. SCRA protections do not apply to obligations incurred by a servicemember during active duty.
Benefits include a maximum interest rate (no higher than six percent) while on active duty and for a specified period after the end of that duty. In addition, the Act offers protections to eligible servicemembers against proceedings involving default judgments and against foreclosure or repossession, subject to specific conditions.
About the Military Lending Act (MLA)
The MLA, enacted in 2006 and implemented by the Department of Defense (DoD), protects servicemembers and their dependents from excessive interest and fees for certain types of consumer credit.
The current protections include a 36-percent annual interest rate cap, known as the Military Annual Percentage Rate (MAPR), which includes most fees and credit insurance premiums on covered transactions. It prohibits or restricts a number of credit agreement terms, such as prepayment penalties, renewals, refinances, or consolidations (unless the terms benefit the borrower).
The MLA requires lenders to provide disclosure of the payment obligations and interest rates both orally and in writing prior to originating any credit obligation to a covered servicemember.
In addition, the MLA prohibits lenders from securing a credit obligation with a personal check, access to a bank account (such as an ACH authorization), or a title to a personal vehicle, or from requiring servicemembers to pay with their military allotment. It prohibits any waiver of a borrower’s legal rights.
We are committed to providing you with superior service. If you have a question or would like to know if you qualify for military statutes benefits and protections, please contact us. If you currently have access to Online Banking, you may contact us via email by logging in.