Foreclosure Protection
The SCRA prohibits foreclosure on a servicemember's property without a court order during active duty and for one year afterward. This applies to mortgages, deeds of trust, and similar security interests on real property originated before military service.
Protection Timeline
The Post-Service Extension
Unlike most SCRA protections that end when active duty ends, foreclosure protection continues for an additional 12 months. This extension recognizes that servicemembers need time to reestablish civilian employment and financial stability.
The extension period requires accurate tracking of when active duty actually ended—not when the servicemember expects it to end. Orders can be extended, and early discharge happens. DMDC verification should be repeated before any foreclosure action after service ends.
Court Order Requirements
If foreclosure must proceed during the protection period, court approval is mandatory. The court has specific obligations under §3931 (default judgments):
Stay of Proceedings
Court must stay proceedings for at least 90 days upon request of the servicemember or on its own motion if there may be a defense that cannot be presented without the servicemember.
Appointed Counsel
If the servicemember is not represented, the court must appoint an attorney before entering judgment.
Protection of Dependents
Protection extends to obligations held jointly with a dependent, or by a dependent alone in certain circumstances.
Enforcement History
Federal enforcement of SCRA foreclosure violations has resulted in significant penalties. The DOJ has pursued cases against major servicers for wrongful foreclosures:
Foreclosure hold management
Civrel tracks protected mortgages from identification through the full post-service extension period, alerting your team before protection expires and documenting every decision.
Eligibility Verification
DMDC verification confirms active duty. Pre-service origination check against mortgage date. Protection period calculated automatically.
Hold Management
Cases flagged for foreclosure hold. Integrated with rate cap tracking. Full case history maintained.
Expiration Monitoring
Service end date tracking. Automatic alerts at 90, 30, and 7 days before protection expires. Re-verification before release.
Documentation
Complete case file for each protected property. Verification certificates. Decision audit trail for examiner review.
Who needs foreclosure protection compliance
See foreclosure hold tracking in action
Book a demo to see how Civrel manages §3953 compliance across your mortgage portfolio.