June 14, 2021

Bankruptcy and the Military

If you are in the United States military you don’t need to worry about bankruptcy! The government created the SCRA, short for the Servicemembers’ Civil Relief Act, to provide protection against bankruptcy for members of the military. The SCRA ensures that military members are not distracted by financial troubles such as bankruptcy and can focus on their military responsibilities.

Here are some ways the SCRA protects you from bankruptcy while you are serving in active duty in the military:

  • All bankruptcy proceedings are frozen, eviction is prevented, and the court cannot enter into a judgment while members of the military are serving in active duty.
  • Actions such as reducing interest rates on loans and debts that accumulated before active duty can be taken to assist the service person.
  • If military reasons prevent a service person on active duty from appearing in court, an attorney can be appointed for the service person to protect them against default judgments such as bankruptcy proceedings.
  • It is possible for court proceedings to be halted if the defendant is a member of the military and is not able to appear in court.

Even if a court proceeding started before you were serving in the military, the SCRA protections apply to any court proceedings taking place, including bankruptcy, once you begin to serve. Typically 90 days after you have been discharged from the military, SCRA protections end. However, you can be released from an agreement, such as a lease, without any consequences if you were stationed after the agreement was made.

There are several factors that determine SCRA protections and I recommend speaking with an experienced attorney if you are experiencing financial troubles.


Jonathan Ginsberg has been in private law practice since 1987. He writes and teaches about Chapter 7 and Chapter 13 bankruptcy protection.