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Tacoma Washington’s Pacific Lutheran University (PLU) and

BellevueWashington’s Financial Assistance, Inc. (FAI) Violate

the Servicemembers Civil Relief Act (SCRA)

Tacoma Washington is home to Joint Base Lewis-McChord.  Pacific Lutheran University (“PLU”), also located in Tacoma Washington, and its collection agency, Financial Assistance Inc. (“FAI”), located in Bellevue Washington, violated the Servicemembers Civil Relief Act (“SCRA”) by demanding that an active duty member of the United States Air Force pay a fifty percent (50%) collection fee, in addition to the SCRA’s maximum 6% interest rate. The original loan was approximately $6,000.00.  The Servicemember paid almost $7,000.00.  However, FAI demanded almost $6,000.00 more to satisfy the debt.  This calculation is not mathematically possible if a 6% rate of interest is applied. The Servicemember provided a copy of his military orders and a written demand that PLU and FAI reduce the costs and fees on the account to the 6% allowed by the SCRA.  The Servicemember repeatedly informed PLU and FAI that the outrageous 18% interest rate and the outrageous 50% collection fee were prohibited by the SCRA.  FAI refused to correct the erroneous charges.  Therefore, the Servicemember stopped making payments in protest because he refused to create the impression that he agreed with FAI’s violations. In response, rather than doing the right thing and following the statute, FAI filed a lawsuit against the Servicememeber seeking a fifty percent (50%) collection fee, in addition to 6% interest, legal fees, and costs of the lawsuit.  FAI demanded the 50% collection fee, despite already charging the Servicemember over $1,700.00 in collection fees.  As a result, the actual collection fee was well over 80% The SCRA limits the amount of interest that can be charged on debts incurred prior to military service.  The maximum rate of interest allowed under the SCRA is 6% per annum.  “The term “interest” includes service charges, renewal charges, fees, or any other charges (except bona fide insurance) with respect to an obligation or liability.”  See, 50 U.S.C. App. § 511(d)(1).  For the purpose of applying the SCRA to federal student loans: “…the interest rate includes any other charges or fees applied to the loan.”  See, 34 C.F.R. §682.202(a)(8).  For most federal student loans the collection fee may not exceed 40%.  See, 34 C.F.R. §674.45.  The statute preempts any contradictory state law that would allow charging more.  See, 34 C.F.R. §674.45(g). What does all this mean?  Simple: 1) Universities are limited to a maximum collection fee of 40% when collecting federal student loans; and 2) If the SCRA applies to the loan, Universities must waive the 40% collection fee in favor of the SCRA’s maximum interest rate of 6%.  If the loan is a private student loan, state collection laws may apply. Washington’s collection laws allow universities to add a “reasonable” collection fee to private student loans.  See, RCW 28(B).10.293.  However, because the federal statutes limit student loan collection fees to a maximum of 40%, how could it ever be “reasonable” to charge more than 40%?  Additionally, it is never “reasonable” to add any collection fee to a student loan if the Servicemember is entitled to the SCRA’s 6% interest rate cap, because the cap includes: “…all fees or any other charges…with respect to an obligation or liability.” Despite these rules, and despite knowing that the Servicemember was stationed in Texas, PLU, which is located in Tacoma Washington, and FAI, which is located in Bellevue Washington, filed a lawsuit against the Servicemember in Washington State.  The lawsuit seeks a 50% collection fee, in addition to the 6% SCRA interest.  The lawsuit also seeks an award of legal costs and additional attorney’s fees. Not only did PLU and FAI violate the SCRA in this case, but these companies regularly charge a 50% collection fee when collecting Federal Perkins Loans and Federal Nursing Loans, which may violate the 40% cap provided by 34 C.F.R. §674.45.  PLU and FAI also set judgment interest rates at 12%, despite the 5% interest rate cap on Federal Perkins Loans. Robert Mitchell, Attorney at Law, PLLC, is a United States Marine (once a Marine, always a Marine) who believes that our servicemembers should be treated with respect and dignity.  If you believe you have fallen victim to an SCRA violation, please telephone me today at 509-327-2224 or 360-993-5000, or email me at bobmitchellaw@gmail.com. 

Robert Mitchell, Attorney at Law, PLLC,

1020 N. WashingtonSpokane, WA 99201

&

700 W. Evergreen Blvd.Vancouver, WA 98660

This website is not legal advice and does not create an attorney-client

relationship.

 
SCRA
Robert Mitchell Attorney at Law, PLLC Home FCRA FDCPA SCRA Testimonials Atty Bio Contact
© 2016 Robert Mitchell, Attorney at Law, PLLC
creditlaw101.com

Tacoma Washington’s Pacific Lutheran University (PLU) and

BellevueWashington’s Financial Assistance, Inc. (FAI) Violate

the Servicemembers Civil Relief Act (SCRA)

Tacoma Washington is home to Joint Base Lewis-McChord.  Pacific Lutheran University (“PLU”), also located in Tacoma Washington, and its collection agency, Financial Assistance Inc. (“FAI”), located in Bellevue Washington, violated the Servicemembers Civil Relief Act (“SCRA”) by demanding that an active duty member of the United States Air Force pay a fifty percent (50%) collection fee, in addition to the SCRA’s maximum 6% interest rate. The original loan was approximately $6,000.00.  The Servicemember paid almost $7,000.00.  However, FAI demanded almost $6,000.00 more to satisfy the debt.  This calculation is not mathematically possible if a 6% rate of interest is applied. The Servicemember provided a copy of his military orders and a written demand that PLU and FAI reduce the costs and fees on the account to the 6% allowed by the SCRA.  The Servicemember repeatedly informed PLU and FAI that the outrageous 18% interest rate and the outrageous 50% collection fee were prohibited by the SCRA.  FAI refused to correct the erroneous charges.  Therefore, the Servicemember stopped making payments in protest because he refused to create the impression that he agreed with FAI’s violations. In response, rather than doing the right thing and following the statute, FAI filed a lawsuit against the Servicememeber seeking a fifty percent (50%) collection fee, in addition to 6% interest, legal fees, and costs of the lawsuit.  FAI demanded the 50% collection fee, despite already charging the Servicemember over $1,700.00 in collection fees.  As a result, the actual  collection fee was well over 80% The SCRA limits the amount of interest that can be charged on debts incurred prior to military service.  The maximum rate of interest allowed under the SCRA is 6% per annum.  “The term “interest” includes service charges, renewal charges, fees, or any other charges (except bona fide insurance) with respect to an obligation or liability.”  See, 50 U.S.C. App. § 511(d)(1).  For the purpose of applying the SCRA to federal student loans: “…the interest rate includes any other charges or fees applied to the loan.”  See, 34 C.F.R. §682.202(a)(8).  For most federal student loans the collection fee may not exceed 40%.  See, 34 C.F.R. §674.45.  The statute preempts any contradictory state law that would allow charging more.  See, 34 C.F.R. §674.45(g). What does all this mean?  Simple: 1) Universities are limited to a maximum collection fee of 40% when collecting federal student loans; and 2) If the SCRA applies to the loan, Universities must waive the 40% collection fee in favor of the SCRA’s maximum interest rate of 6%.  If the loan is a private student loan, state collection laws may apply. Washington’s collection laws allow universities to add a “reasonable” collection fee to private student loans.  See, RCW 28(B).10.293.  However, because the federal statutes limit student loan collection fees to a maximum of 40%, how could it ever be “reasonable” to charge more than 40%?  Additionally, it is never  “reasonable” to add any collection fee to a student loan if the Servicemember is entitled to the SCRA’s 6% interest rate cap, because the cap includes: “…all fees or any other charges…with respect to an obligation or liability.” Despite these rules, and despite knowing that the Servicemember was stationed in Texas, PLU, which is located in Tacoma Washington, and FAI, which is located in Bellevue Washington, filed a lawsuit against the Servicemember in Washington State.  The lawsuit seeks a 50% collection fee, in addition to the 6% SCRA interest.  The lawsuit also seeks an award of legal costs and additional attorney’s fees. Not only did PLU and FAI violate the SCRA in this case, but these companies regularly charge a 50% collection fee when collecting Federal Perkins Loans and Federal Nursing Loans, which may violate the 40% cap provided by 34 C.F.R. §674.45.  PLU and FAI also set judgment interest rates at 12%, despite the 5% interest rate cap on Federal Perkins Loans. Robert Mitchell, Attorney at Law, PLLC, is a United States Marine (once a Marine, always a Marine) who believes that our servicemembers should be treated with respect and dignity.  If you believe you have fallen victim to an SCRA violation, please telephone me today at 509-327-2224 or 360-993-5000, or email me at bobmitchellaw@gmail.com.

Robert Mitchell, Attorney at Law, PLLC,

1020 N. WashingtonSpokane, WA 99201 & 700 W. Evergreen Blvd.Vancouver, WA 98660 This website is not legal advice and does not create an attorney-client relationship.  
SCRA
Robert Mitchell Attorney at Law, PLLC
© 2016 Robert Mitchell, Attorney at Law, PLLC
creditlaw101.com
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Tacoma Washington is home to Joint Base Lewis-McChord.  Pacific Lutheran University (“PLU”), also located in Tacoma Washington, and its collection agency, Financial Assistance Inc. (“FAI”), located in Bellevue Washington, violated the Servicemembers Civil Relief Act (“SCRA”) by demanding that an active duty member of the United States Air Force pay a fifty percent (50%) collection fee, in addition to the SCRA’s maximum 6% interest rate. The original loan was approximately $6,000.00.  The Servicemember paid almost $7,000.00.  However, FAI demanded almost $6,000.00 more to satisfy the debt.  This calculation is not mathematically possible if a 6% rate of interest is applied. The Servicemember provided a copy of his military orders and a written demand that PLU and FAI reduce the costs and fees on the account to the 6% allowed by the SCRA.  The Servicemember repeatedly informed PLU and FAI that the outrageous 18% interest rate and the outrageous 50% collection fee were prohibited by the SCRA.  FAI refused to correct the erroneous charges.  Therefore, the Servicemember stopped making payments in protest because he refused to create the impression that he agreed with FAI’s violations. In response, rather than doing the right thing and following the statute, FAI filed a lawsuit against the Servicememeber seeking a fifty percent (50%) collection fee, in addition to 6% interest, legal fees, and costs of the lawsuit.  FAI demanded the 50% collection fee, despite already charging the Servicemember over $1,700.00 in collection fees.  As a result, the actual collection fee was well over 80% The SCRA limits the amount of interest that can be charged on debts incurred prior to military service.  The maximum rate of interest allowed under the SCRA is 6% per annum.  The term “interest” includes service charges, renewal charges, fees, or any other charges (except bona fide insurance) with respect to an obligation or liability.”  See, 50 U.S.C. App. § 511(d)(1).  For the purpose of applying the SCRA to federal student loans: “…the interest rate includes any other charges or fees applied to the loan.”  See, 34 C.F.R. §682.202(a)(8).  For most federal student loans the collection fee may not exceed 40%.  See, 34 C.F.R. §674.45.  The statute preempts any contradictory state law that would allow charging more.  See, 34 C.F.R. §674.45(g). What does all this mean?  Simple: 1) Universities are limited to a maximum collection fee of 40% when collecting federal student loans; and 2) If the SCRA applies to the loan, Universities must waive the 40% collection fee in favor of the SCRA’s maximum interest rate of 6%.  If the loan is a private student loan, state collection laws may apply. Washington’s collection laws allow universities to add a “reasonable” collection fee to private student loans.  See, RCW 28(B).10.293.  However, because the federal statutes limit student loan collection fees to a maximum of 40%, how could it ever be “reasonable” to charge more than 40%?  Additionally, it is never “reasonable” to add any collection fee to a student loan if the Servicemember is entitled to the SCRA’s 6% interest rate cap, because the cap includes: “…all fees or any other charges…with respect to an obligation or liability.” Despite these rules, and despite knowing that the Servicemember was stationed in Texas, PLU, which is located in Tacoma Washington, and FAI, which is located in Bellevue Washington, filed a lawsuit against the Servicemember in Washington State.  The lawsuit seeks a 50% collection fee, in addition to the 6% SCRA interest.  The lawsuit also seeks an award of legal costs and additional attorney’s fees. Not only did PLU and FAI violate the SCRA in this case, but these companies regularly charge a 50% collection fee when collecting Federal Perkins Loans and Federal Nursing Loans, which may violate the 40% cap provided by 34 C.F.R. §674.45.  PLU and FAI also set judgment interest rates at 12%, despite the 5% interest rate cap on Federal Perkins Loans. Robert Mitchell, Attorney at Law, PLLC, is a United States Marine (once a Marine, always a Marine) who believes that our servicemembers should be treated with respect and dignity.  If you believe you have fallen victim to an SCRA violation, please telephone me today at 509-327-2224 or 360- 993-5000, or email me at bobmitchellaw@gmail.com.

Tacoma Washington’s Pacific Lutheran University

(PLU) and BellevueWashington’s Financial

Assistance, Inc. (FAI) Violate the Servicemembers

Civil Relief Act (SCRA)

Robert Mitchell, Attorney at Law, PLLC,

1020 N. WashingtonSpokane, WA 99201 & 700 W. Evergreen Blvd.Vancouver, WA 98660 This website is not legal advice and does not create an attorney-client relationship.  
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