Learn About SCRA
Complete SCRA Guide Eligibility Requirements How to File Claims National Guard Reserves
All Protections
6% Interest Rate Cap Retroactive Refunds Lease Termination Eviction Protection Foreclosure Protection Contract Cancellation Insurance Protections Tax Protections Legal Protections Court Stays
Landlords & Leases
All Landlords Greystar General Guide
Services & Contracts
All Services Auto Leases Verizon Planet Fitness
By Lender
All Lenders Chase USAA Navy Federal
By Debt Type
All Debt Types Auto Loans Mortgages Credit Cards Student Loans
Product & Intel
Pricing Intel Support
Sign In
Sign Up
Comparison

MLA vs SCRA: What's the Difference?

Two different laws, two different protections. Here's how to know which applies to your situation.

Overview: Two Laws, Different Purposes

Both the Military Lending Act (MLA) and the Servicemembers Civil Relief Act (SCRA) protect military families from predatory lending—but they work differently and apply in different situations.

SCRA
Servicemembers Civil Relief Act
Originally enacted 1940, updated 2003
6%
Maximum interest on pre-service debts
MLA
Military Lending Act
Enacted 2006, expanded 2015
36%
Maximum rate on new consumer loans

Key Differences at a Glance

Feature SCRA MLA
When debt was incurred Before service During service
Interest rate cap 6% 36%
Must request benefit Yes No (automatic)
Retroactive refunds Yes Varies
Covers mortgages Yes No
Covers auto loans Yes No (secured loans excluded)
Protects dependents Limited Yes

SCRA: Protecting Pre-Service Debts

The SCRA focuses on debts you already had before entering military service. The idea is simple: you shouldn't be punished financially for answering the call to serve.

  • 6% rate cap on all pre-service debts (credit cards, mortgages, auto loans, student loans)
  • You must request it by submitting military orders to each lender
  • Retroactive application from your first day of service
  • Refunds available for interest overpaid before you requested

MLA: Protecting Against Predatory Lending

The MLA protects service members (and dependents) from predatory lending on new loans taken out during service. It focuses on high-cost consumer credit products.

  • 36% MAPR cap (Military Annual Percentage Rate) on covered loans
  • Automatic protection—lenders must check military status and apply automatically
  • Covers: Payday loans, vehicle title loans, refund anticipation loans, some installment loans
  • Does NOT cover: Residential mortgages, auto purchase loans, home equity loans
Important Distinction

The MLA doesn't help with debts from before your service—those require SCRA. And SCRA doesn't automatically protect new loans—that's what the MLA is for. They're complementary protections.

Which Law Applies to Your Situation?

Quick Determination
When did you take out the loan?
Before Military Service
SCRA applies. You can request the 6% rate cap and retroactive refunds.
During Military Service
MLA may apply if it's a covered consumer loan. Check the 36% rate cap.

Common Scenarios

Credit card from college, now on active duty

SCRA applies. Request the 6% cap and any retroactive refunds. The MLA doesn't help because credit cards are not "covered credit" under the MLA definition.

Car loan taken out after enlisting

Neither fully applies. SCRA doesn't apply (incurred after service). MLA excludes vehicle purchase loans. However, if you took out a separate unsecured loan during service, the MLA would cap it at 36%.

Spouse takes out a payday loan

MLA applies. The MLA covers dependents, so your spouse is protected by the 36% cap on payday loans. SCRA generally doesn't extend to spouse-only debts.

Can Both Apply?

In rare cases, yes. If you have a mix of pre-service and during-service debts, different protections apply to each. SCRA Saver helps you identify which law applies to each of your accounts.

Check Your Protections

Enter your debt details and we'll tell you exactly which protections apply and how much you could save.

Analyze My Debts