WASHINGTON - When Army reservist Steve Welter was called up for active duty in Iraq in August, his wife never thought she would face her own fight to save the family's home from foreclosure.
A 65-year-old federal law, which Congress expanded last year, provides a range of protections for activated reservists and for Guard members called up by the Pentagon.
Those protections include a 6 percent cap, under certain circumstances, on consumer and mortgage interest rate debt incurred before activation; protection from eviction or foreclosure; payment deferral for federal taxes; and a stay on civil proceedings, including divorce and bankruptcy.
Keira Welter knew the law was supposed to protect a soldier's property from creditors during active military service. But for months, she said, Wells Fargo Home Mortgage Co. did not seem to care about the law, no matter how many times she explained her case.
"We had worked so hard to own our own home, and while my husband was over there serving our country it was going to be taken away," said Welter, 31, of Osawatomie, Kan.
After Wells Fargo started foreclosure proceedings in February, Keira Welter contacted the state attorney general's office and members of Congress. It was not until a local television station aired her story and Sen. Pat Roberts, R-Kan., intervened that the company finally backed off.
The Welters are not the only ones who faced hurdles seeking protection under the Servicemembers Civil Relief Act. Lt. Col. Bruce Woolpert, a legal adviser to the Kansas National Guard in Topeka, said he fields desperate calls every week from soldiers and their families trying to understand their rights under the law and asking how they can stop creditors from repossessing cars or seizing homes.
"We had a foreclosure that was actually going to occur the next day," Woolpert said. "It was going to happen until we could generate the letters and get them to the company and say, 'Please stop this, it's not a valid foreclosure.' Wisdom prevailed and it was stopped."
The military is quick to let families know about the law as part of the family support briefing that soldiers get before they are deployed.
But the help is not automatic. Soldiers and sailors have to ask for it and provide proof of their call-up. Woolpert said the soldiers are given pre-typed letters of requests to creditors to make the process easier. Still, many soldiers call him later to understand how to qualify for help. Woolpert said most companies understand the law and try to follow it, but some, particularly smaller banks and car loan companies, are not as enlightened.
Kevin Waetke, a spokesman for Wells Fargo Home Mortgage in Des Moines, Iowa, said the company has apologized to Welter and dismissed the foreclosure action. The company has special procedures in place for active duty soldiers that its employees are supposed to follow.
"What this isolated incident has shown us is that there are ways to enhance our processes," Waetke said. The Welters' case was unusual, Woolpert said, because most big lenders are familiar with the law.
"One of the problems is with large lending institutions, as soon as the matter goes to collection, it becomes a bureaucratic problem to reverse the trend," Woolpert said. "Sometimes it's hard to find the right person to say 'Stop this because the rule applies.'"
In Welter's case, she appeared to follow all the rules. She first sent a copy of her husband's duty orders to Wells Fargo in August. The company claimed it was never received.
She kept calling the company to explain how the family, with three young children, struggled to make mortgage payments during her husband's Army training, when he had to stop working as a full-time firefighter for weeks at a time. His reserve paychecks were much smaller than his firefighter salary.
"I mentioned the law every single time," Welter said. "And every single time I was told 'We don't know what that is.'"
Roberts, outraged by Welter's story, took the issue to the Senate. "I remain concerned that those responsible for complying with the Servicemembers Civil Relief Act are not fully educated about their obligations and that the problem is nationwide," Roberts said.
The senator has asked the Office of the Comptroller of the Currency, which regulates national banks, to post the law on its Web site and include it in any publications it sends to banks.
Kevin Mukri, a spokesman for the Comptroller of the Currency, said the agency has not received Roberts' letter. But he said national banks are very familiar with all federal laws and regulations. "I have not heard of this being an issue," Mukri said.
Keira Welter said she still is concerned about what will happen when her husband comes back from Iraq. The legal protection generally ends within 90 days after the date of discharge from active duty, though she expects to be caught up on mortgage payments by then.
"I want my credit to be cleaned up," she said. "I want them to restore the late fees and I want to make sure this never happens again."
ASHINGTON, March 25 - 
