If someone said that you could potentially save hundreds of dollars by spending a few hours, would you do it? Of course! Getting your credit card interest rates reduced during your deployment takes time, however, in today’s economy, it would be advantageous. You are about to embark on a deployment and if you budget wisely can use the extra earned money to pay off debt.
First, get organized. As you are preparing your legal paper work, budgeting, paying off current bills and putting service contracts on hold for your deployment, make a list of the creditors you owe and your current interest rate. If your interest rates are lowered, then you are paying more down on principal. Have your account information, interest rate, and current balance. Also, be prepared to sign up for automatic payment so you do not need to worry during your deployment. This often requires your checking and routing numbers for your bank account.
It is best to start by calling your credit card company and informing them of your deployment. Ask if you can have your rates reduced during your deployment. Many will ask for proof and will give you 90 days to provide 1 of 4 pieces of documentation. Normally, enlistment papers, Leave Earning Statement, Orders for your deployment, or pay stub. During the 90 days, your account will be put on hold and will not accrue any interest or have payments dues. However, if you do not get this information to them on time, your account will retroactively accrue interest and resume at the higher interest rate.
If you have a military STAR credit card, they will place your account under the 6% interest cap for the duration of your deployment. However, you will need to call and ask. Usually this is a card that is issued through the exchange or alternatively though the clubs on base.
If your creditors are not willing to lower your interest rates, you are protected by law by the Soldiers and Sailor’s Civil Relief Act (SSCRA), which states: If your military obligation affects your ability to pay your financial obligations, you can request (in writing) that the interest rate be lowered and capped at a fixed 6% rate for the duration of your active duty service. However, this rate only applies to pre-service debt. Some lenders may also require a copy of your orders so that they can verify your service. If you think you might be eligible, you can contact your Military Legal Assistance office. This information is taken from www.usmilitary.com and Military One Source.
Know your rights and be prepared with proper documentation and this process does not need to be too time consuming or take away from precious time with loved ones before your departure. By investing a little time you will be able to reap huge returns and get out of debt! Happy rate reductions!