The Department of Housing and Urban Development on Monday mailed letters to mortgage lenders, reminding them of their obligation to active-duty service members under the 1940 Soldiers' and Sailors' Civil Relief Act. According to the law, lenders must reduce interest rates on debts incurred before the service member entered active service to no more than 6 percent. More detailed information about the program is available from HUD at 1-888-297-8685. Additional information will also be posted on the HUD web site, at: http://www.hud.gov
The law also protects renters by allowing them to terminate leases without incurring penalties, and by prohibiting landlords from evicting them while they are on active duty, said Housing and Urban Development Secretary Mel Martinez. "I'm also taking additional steps and encouraging mortgage lenders to postpone principal payments on all servicemen and women during their tour of duty, if they chose to avail themselves of that opportunity," Martinez said. The law will be especially welcomed by the thousands of reservists who have been called to active duty since the terrorist attacks of Sept. 11, said Defense Secretary Donald Rumsfeld in a briefing for reporters at the Pentagon. "They're leaving their jobs, and many, of course, take a hit in their paychecks. This program is designed to ease their mortgage burdens and actually do some additional things as well with respect to renters, as these individuals serve their country," Rumsfeld said.