Sens. Patty Murray (D-Wash.), Dick Durbin (D-Ill.) and Bernie Sanders (D-Vt.) today introduced the SCRA Enhancement and Improvement Act of 2016, which expands the provisions of the Servicemembers Civil Relief Act.
Among other things, the bill lowers the interest rate cap for all loans to servicemembers from six percent to three percent (or zero percent for military personnel serving in combat areas), and applies the cap automatically to all debt, regardless of when it was incurred. In the event a service member dies in the line of duty, the bill provides for the forgiveness of all outstanding federal and private student loans.
Additionally, student loan servicers would also be required to have a designated representative to handle service member inquiries, and all lenders will be required to give sufficient notice when loans are transferred and ensure that loan benefits and protections transfer seamlessly. The bill also clarifies a private right of action under SCRA. Under the bill, entities violating SCRA protections would face double fines.
