Servicemembers and Rental Housing

There was a time not so long ago that many people either served in the military or had a close friend or family member who did - when there was greater awareness of the unique challenges faced by military personnel and their families – many around housing.

Frequent moves, deployments and the risk associated with military service complicate the landlord-tenant relationship. These circumstances can make it impossible for the service member and their family to fulfill the terms of the typical rental agreement.

Congress recognized these challenges with passage of the Sailors’ Civil Relief Act of 1940 and subsequently the Servicemembers’ Civil Relief Act (SCRA) of 2003 (50 USC App §§501-596) – “<by providing> protections for issues involving taxation, house/apartment leases, car leases, interest rates and insurance”.

“The SCRA protects those persons who serve on active duty for the nation’s defense, from adverse consequences to their legal rights that may result because of such service, so that such persons may devote their full attention and all their energies to the nation’s defense”.

The SCRA applies to all active duty members of the United States military – across all 50 states and U.S. territories and up to 180 days after separation.  Following are excerpts from a Marine Corps document relevant to this subject.

Credit Agency Information: A credit agency may not identify a member’s status as guard or reserve because such identification may cause a lender to deny or revoke credit, change credit terms or view the credit report negatively against the member.

It is not entirely clear how this actually protects the servicemember since verification of employment is typically part of the tenant screening package or process. That said, rental criteria that would deny tenancy or offer less favorable terms to military servicemembers may well run afoul of fair housing statutes.

“Racial and ethnic minority groups made up 40% of Defense Department active-duty military in 2015, up from 25% in 1990 (Pew Research).

Termination of Real Estate Leases: A member <of the military services> may terminate, without penalty, leases and rental agreements entered into before or during active military service for real estate properties (i.e., residences, businesses) if the member meets certain conditions. Previously, the SSCRA did not permit such terminations if the lease or rental agreement was entered into during active service. Generally, the member must be called to active duty service for at least 90 days, or receive military orders for a permanent change of station or orders to deploy for at least 90 days. Such terminations also terminate any obligation of the member’s dependents under the lease.  Terminating the lease requires written notice to the lessor with a copy of military orders. 

Ideally, these provisions are clearly outlined in the rental agreement or Military Addendum.

Evictions. Some states require a court order for a landlord to evict and others do not require such a court order. The SCRA makes it a requirement for all states that landlords obtain a court order to evict a military member or the member’s dependents during the period of the member’s active duty service. The monthly rental amount for the leased residence cannot exceed $2,958.53 (as of 1 Jan 10) for the protections to apply.  If the member or the member’s dependents meet certain qualifications, the member or the member’s dependent may request a stay of an eviction action. The court will grant relief it deems appropriate. The SCRA creates criminal offenses for landlords who violate this SCRA protection.

Default Judgments. A member may request the court to re-open a matter and set-aside a default judgment if the judgment was entered against the member during the member’s active duty period, or within 60 days after the member’s release from active military duty. The member must timely request such relief (i.e., within 90 days from release from active duty), show the active service materially affected the member’s ability to defend against the action, and show that he or she has a good defense. You should consult with a legal assistance attorney to obtain information on possible relief available to you.

Few would argue with the substance or intent of the Servicemembers Civil Relief Act – the extension of support to those who put their lives on the line to protect the rest of us deserve our support.  Still, it pays to understand precisely what is required of us, what triggers those requirements and best practices around compliance.

There are, of course, many advantages to working with servicemembers – so much so that there are rental housing owners and managers who specialize in the space.  But at the end of the day, this Veteran's Day and beyond – it is also the right thing to do.