Washington, DC – With thousands of military servicemembers currently deployed overseas, U.S. Senator Sheldon Whitehouse (D-RI) today introduced legislation to give them and their families peace of mind back home by enhancing foreclosure protections. The Protecting Servicemembers from Mortgage Abuses Act of 2011, cosponsored by Senators Jack Reed (D-RI), Jeff Merkley (D-OR), Bernie Sanders (I-VT), and Jon Tester (D-MT) would improve protections against abuses and provide greater incentives for financial institutions to comply with the Servicemembers Civil Relief Act.
“Our troops serving abroad face countless threats every day, but the threat of foreclosure should not be among them,” said Whitehouse. “This legislation will help ensure that servicemembers and their families, who have sacrificed so much, will not be forced to endure the pain of foreclosure while they defend our country.”
“Soldiers who are fighting on the frontlines to protect our country shouldn’t have to needlessly fight with banks to protect their homes. Senator Whitehouse’s bill is a good step to address this important issue,” said Reed.
“Our men and women in uniform have sacrificed so much for the country already, they shouldn’t have to sacrifice their family home too,” Merkley said. “We should have no tolerance for mortgage practices that strip wealth from military families and push them into foreclosure. It’s our responsibility to provide as much support as we can to help American servicemembers and their families keep their homes.
“Taking advantage of the troops who leave their friends and family, and put their lives on the line—that’s something no Montanan and no American should stand for,” said Tester, Montana’s only member of the Veterans’ Affairs Committee. “This bill will see to it that any Wall Street banker trying to scam our troops will find themselves on the wrong side of jail cell door. Because that’s where they belong.”
The Servicemembers Civil Relief Act (SCRA), which was enacted in 2003, was designed to prevent active duty military from certain financial and legal hardships as a result of their absence due to military service. Unfortunately, financial institutions have repeatedly failed to comply with the SCRA. Major loan servicers have been responsible for mistakes that led to thousands of mortgage overcharges and a number of unlawful foreclosures and evictions.
During testimony in the House of Representatives earlier this month, an executive from J.P. Morgan Chase & Co. testified that the company “failed to comply with aspects of the law” in overcharging 4,500 servicemembers and improperly foreclosing on 18.
The Protecting Servicemembers from Mortgage Abuses Act of 2011 would encourage compliance with the SCRA by doubling the maximum criminal penalties for violations of its foreclosure and eviction protections. It would also double civil penalties in cases where the Attorney General has commenced a civil action. In addition, the bill will give servicemembers the time they need after returning from deployment to regain solid financial footing, by extending the period of foreclosure protection coverage from 9 to 24 months after military service has ended.
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