Servicemembers Civil Relief Act (SCRA) for Military [Waived Annual Fees, 6% Interest Rates]

Are you an active-duty military member or about to become one? When joining the armed forces, you are entitled to certain financial benefits. These benefits protect servicemembers from financial distress while protecting the nation — and some of the perks are pretty stellar.

The Servicemembers Civil Relief Act (SCRA) is one such regulation. It applies to the debt you acquired before you joined the military. Let’s examine the SCRA, how it works, and how to request your SCRA benefits.

What Is the Servicemembers Civil Relief Act (SCRA)?

Initially published in 1940, the SCRA was created to help relieve servicemembers’ financial distress. It offers various protections to active-duty military personnel, including capped interest rates and a moratorium on foreclosures.

While these benefits are useful, the SCRA only applies to debt acquired before becoming active duty. If you’ve already activated, any new debt you accrue will be subject to the Military Lending Act (MLA), a similar but less comprehensive regulation.

Who Qualifies for the SCRA?

Not everyone qualifies for the SCRA benefits, including those in ROTC or academy cadets. Reserve and National Guard members must also meet specific requirements to claim relief via the SCRA.

Here’s who makes the cut:

• Active–duty members of the Army, Marine Corps, Navy, Air Force, Space Force, and Coast Guard
• Members of the Reserve component when serving on active duty
• Members of the National Guard component mobilized under federal orders for more than 30 consecutive days
• Active-duty commissioned officers of the Public Health Service or the National Oceanic and Atmospheric Administration

Bottom Line:

Not everyone qualifies for the SCRA. For those who are eligible, debts acquired before entering active duty become protected.

Benefits of the SCRA

So, what kinds of benefits do you receive from the SCRA? The act offers quite a few perks:

• Caps Interest Rates on Debt at 6%: This is true for all types of loans acquired before entering active service, including credit cards, auto loans, student loans, and home loans.
• Protects Against Default Judgments in Civil Cases: This protection applies when you’re being civilly sued and forbids any default judgment against you. In other words, you can’t be automatically judged at fault for not showing up to the case.
• Protects Against Foreclosure on Your Home: This protection forces lenders to obtain a court order before foreclosing on your property.
• Protections Against Repossession of Your Property: As it sounds, lenders cannot repossess your property, including a car, without a court order.
• Termination of Residential Housing and Automobile Leases Without Penalty: This benefit can be especially helpful to those needing to break a lease when called to active duty, as it allows you to do so without penalty.

Hot Tip:

Those who signed a lease while on active duty and have received a permanent change of station (PCS) order or an order for a deployment of more than 90 days can also terminate their leases without penalty.

Although waived annual fees aren’t explicitly stated as an SCRA benefit, they pair with the 6% interest rate. Annual fee premiums are calculated as part of the 6% rate, and lenders must waive annual fees to meet regulations.

Applying for SCRA Benefits

How do you complete your application if you have an account eligible for SCRA benefits? The process varies depending on the bank but can usually be done online, by fax, mail, or phone.

Since SCRA benefits only apply to cards you’ve already opened before joining the military, applying for benefits is a manual process. This is in contrast to using MLA benefits, which can be applied automatically.

To request SCRA benefits with American Express, for example, you’ll first need to log in to your account. From there, navigate to Account Services at the top of the page, then click Credit Management.

Select SCRA Benefits to be presented with Amex’s SCRA benefits request page.

Once you’ve applied, Amex will review your account to determine if you’re eligible. If you are, you’ll immediately start receiving the benefits, such as that 6% interest rate and waived annual fees.

The process is essentially the same for other banks and lenders, though you’ll need to contact each one individually to see how they review applications.

Best Cards for SCRA

So, which cards are best for servicemembers eligible for SCRA benefits? As you can expect with the Military Lending Act (MLA), ideal SCRA cards are the best credit cards available. These cards have the biggest benefits, such as annual credits, top-tier elite status, lounge access, and more.

Best SCRA Cards for General Travel

Do you want to expand your travel opportunities with a credit card? This site is all about maximizing your points and miles, and credit cards can be a large part of that. While there are hotel and airline-specific cards, some of the best options tend to be general-use travel cards.

General-use travel credit cards earn flexible point currencies, so the points they earn can be converted into multiple types of points or miles.

The most popular flexible point currencies are American Express Membership Rewards, Bilt Rewards, Capital One Miles, Chase Ultimate Rewards, Citi ThankYou Rewards, and Marriott Bonvoy.

We’ll detail 2 of the best cards for general travel. Acquire these cards before you join the military or become active duty to be eligible for SCRA benefits.

The Platinum Card^® from American Express

The Amex Platinum card is a hefty beast. It charges a $695 annual fee (rates & fees) and offers hundreds of dollars per year in statement credits. In addition, it provides high-end perks such as hotel elite status, airport lounge access, and travel insurance.

Although the card doesn’t fare as well as others when it comes to travel earnings, it does have a standout feature: the ability to earn 5x Membership Rewards on flights booked directly with the airline or via AmexTravel.com (up to $500,000 per year, then 1x). This is the most generous return (11% return on your flight bookings) you’ll find anywhere, especially since we value Amex points at 2.2 cents each.

Chase Sapphire Reserve^®

The Chase Sapphire Reserve card made waves when it debuted in 2016 thanks to its $300 annual travel credit and powerful Ultimate Rewards point system. With various Chase transfer partners, including Hyatt, Southwest, British Airways, and Virgin Atlantic, it’s easy to redeem any points you earn.

The Chase Sapphire Reserve card features one of the best airport lounge memberships, with a Priority Pass Select membership that grants access to airport lounges and experiences.

Aside from this, it also earns 3x Ultimate Rewards on all travel purchases, which makes this card an excellent all-around travel card.

Best SCRA Cards for Hotels

Whether you stay at hotels once a year or multiple times a month, having a hotel credit card can make your life easier. The best cards offer statement credits and top-tier elite status, though they’d generally charge a high annual fee.

Hilton Honors American Express Aspire Card

One of our favorite hotel credit cards, the Hilton Aspire card, normally charges a $550 annual fee. In return, cardholders can get more than $750 in statement credits each year, Hilton Honors Diamond elite status, and an annual free night certificate. Put together, these far outweigh the cost, even if you don’t use SCRA benefits.

The statement credits include:

• Up to $400 at Hilton resorts
• Up to $189 CLEAR Plus credit
• Up to $200 flight credit

Hilton Honors Diamond elite status is also incredibly lucrative, with benefits such as suite upgrades, late checkout, and complimentary breakfast available to members.

Marriott Bonvoy Brilliant^® American Express^® Card

Another American Express card, the Marriott Bonvoy Brilliant card, charges a $650 annual fee (rates & fees). Like the Hilton Aspire card, the Marriott Bonvoy Brilliant card provides statement credits, a free night certificate, and elite status. It also offers airport lounge access with a Priority Pass Select membership.

However, the card’s statement credit is more limited, offering just up to $300 per year for dining purchases (up to $25 per month), and its status is Platinum Elite, which isn’t Marriott Bonvoy’s highest. That said, Marriott Bonvoy Platinum Elite members still enjoy complimentary breakfast and various other hotel perks with their status.

Best SCRA Cards for Airlines

Active-duty servicemembers already have quite a lot of lounge access while traveling, including entry to United and American lounges. However, to do so, you must be traveling in uniform, which can be uncomfortable. Our recommended cards provide lounge memberships and a variety of other benefits that can make air travel the best experience possible.

United Club℠ Infinite Card

The most costly United credit card, the United Club Infinite card charges a $525 annual fee. Along with a United Club membership, cardholders gain numerous perks on United flights:

• 2 free checked bags
• Up to $100 statement credit for Global Entry, TSA PreCheck, or NEXUS 
• Priority boarding, check-in, and luggage handling
• IHG One Rewards Platinum Elite status
• 10% off United economy awards
• Name added to the upgrade list

Delta SkyMiles^® Reserve American Express Card

Delta doesn’t offer complimentary access to its Sky Clubs for military members, so if you frequent these lounges, you’ll want to consider the Delta Reserve card.

With a $650 annual fee (rates & fees), the card comes with a Delta Sky Club membership, allowing you entry when you fly with Delta. This is in addition to other benefits such as a free companion ticket on flights each year, plus:

• 15% off award flights
• Up to $240 in statement credits for Resy restaurants
• Up to $120 in ride-share credits
• Up to $200 Delta Stays credit
• Application fee credit for Global Entry/TSA PreCheck
• 1 free checked bag
• Priority boarding
• Name added to the upgrade list
• Rental car elite status

Enrollment may be required for some of the statement credits mentioned above.

Bottom Line:

Travel credit cards are some of the best options for those with SCRA benefits, thanks to the statement credits and perks that they provide, which can be worth thousands of dollars annually.

Best SCRA Card for Cash-Back

Most credit cards that earn cash-back don’t charge an annual fee, which means having SCRA benefits won’t do much aside from capping interest at 6%. However, there is 1 particular card that can be of benefit:

Blue Cash Preferred^® Card from American Express

The Amex Blue Cash Preferred card charges a $0 intro annual fee for the first year, then $95 (rates & fees). It’s easy to see the value with the cash-back it earns and the statement credits it provides:

• Up to $84 each year on The Disney Bundle
• Up to $120 each year on Equinox+
• 6% cash-back on groceries (up to $6,000 each year) and select streaming services
• 3% back on transit and gas

Make sure you enroll your card first to enjoy your card’s statement credit benefits.

Final Thoughts

If you have accounts eligible for SCRA benefits, contact your bank to have those benefits applied. Remember that any new credit cards or debts you incur while in the service will fall under the Military Lending Act (MLA), which provides similar but less comprehensive benefits.