Sample Letter to Creditor on 6 Percent Interest Rate
Dear Sir or Madam:
I incurred this debt prior to my entry into the Armed Forces, at a time when I was earning substantially more than I am now. My entry into military service has substantially affected my ability to meet this obligation at the original interest rate.
The SSCRA sets a 6 percent per annum ceiling on interest charges (including service charges, renewal charges, and fees) during the period of a servicemember’s military service for obligations made prior to the date of entry into active duty when the active duty materially affects the ability to pay. Since entering active duty, I have experienced a decrease in salary, adversely affecting my ability to pay. Thus, the balance of my obligation may not have interest charged at a rate greater than 6 percent per annum. Interest above 6 percent must be forgiven and not accrued. Please ensure that your records reflect this statutory ceiling and that any excess charge is withdrawn.
Please be further advised that you may not repossess for nonpayment of an installment obligation without first complying with the provisions of 50 U.S.C app. § 531 of the SSCRA.
Thank you, in advance, for your cooperation in this matter.