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Military Deployment: Managing an Auto Loan or Lease

Deployment or a change of station can alter how you use a vehicle and how easily you can manage its payments. A lease, a financed purchase, and emergency assistance each follow different rules. Review the agreement and your orders together, keep copies of notices, and contact the appropriate support office before making a costly change.

The questions below use selected Consumer Financial Protection Bureau guidance, adapted and organized by Fynoptic. Source links and the dates displayed by those sources are provided at the end.

I am in the military and may be stationed overseas. How can I handle my auto lease or auto loan?

Under certain circumstances, the Servicemembers Civil Relief Act (SCRA) allows active-duty servicemembers to terminate an auto lease without having to pay early termination charges or a penalty. If you purchased a car with an auto loan, many lenders won’t let you move your vehicle overseas and the law does not require them to do so.

If you’re a servicemember who is ordered to move overseas or deploy, there are steps you can take to terminate your auto lease without penalty and to make sure a new car you are purchasing with an auto loan can be taken out of the country.

Eligibility to terminate your auto lease

In order to terminate an auto lease without penalty under the SCRA, you must have entered into the auto lease:

  • Prior to active duty, and then been called onto active duty for 180 days or longer; or
  • During active duty, and then received orders for:
    • a Permanent Change of Station (PCS) from a location inside the continental United States (CONUS) to a location outside the continental United States (OCONUS), or a PCS from a location OCONUS to any new location; or
    • deployment with a military unit or in support of a military operation for 180 days or longer.

If you entered into your auto lease during active-duty military service and then received PCS orders, here are some examples of which orders allow you to terminate your auto lease under the SCRA:

  • OCONUS to any other state or location
    • For example, Alaska to Hawaii, or Alaska to Texas, or Hawaii to Germany
  • CONUS to OCONUS
    • For example, Georgia to Alaska

Carefully read your lease terms and consider your situation before signing the contract. The SCRA does not allow you to terminate your contract if you receive PCS orders from one CONUS location to another, for example, Georgia to California. If you know you may receive those type of PCS orders, make sure your lessor will allow you to take the vehicle you intend to lease out of state.

How to request to terminate your auto lease

To terminate your auto lease without penalty, you must:

  • Provide a written notice of termination to the “lessor” or lessor’s agent. The lessor is the company or the individual that leased you the vehicle;
  • Provide a copy of your military orders to the lessor or agent;
  • Deliver the written notice by hand, by a private carrier, by certified mail with return receipt via the US Post Office, or by electronic means (such as e-mail or a communications portal designated by lender or agent); and
  • Return the vehicle within 15 days after the date of delivery of the written notice of termination.

Your auto lease will only be terminated after you complete all of these steps, including returning the vehicle.

While the lessor can’t charge you for the early cancellation of the lease, the lessor can still charge you for any taxes, title and registration fees, summonses, or any other outstanding fees, including reasonable charges for excessive wear and tear and mileage that were due and unpaid on the date of termination. If you made any advance payments, the lessor must provide a refund to you within 30 days of the termination.

What to do if you are purchasing a car with an auto loan and plan to take it overseas

If you have already purchased a car with an auto loan, the law does not require the lender to allow you to take it overseas. If you are planning to purchase a car with an auto loan, make sure before you sign the loan contract that your lender will allow the vehicle you intend to buy to be taken out of the country. Only your lender can agree to this, unless your dealer is also your lender in what’s called a “buy here pay here” auto loan.

Most shipping companies will require you to prove that your lender allows you to ship the vehicle overseas, so it’s important to get this in writing when you sign the contract.

It is also important to get in writing that the warranty and any extended warranty will be valid if you need to have any repairs done outside the continental U.S. Many warranties are not valid overseas.

If your lessor refuses to accept your lease termination or tries to charge you a penalty, or you need guidance on shipping a vehicle overseas with a loan, contact your closest legal assistance (JAG) office for more information. You also may be able to get assistance from your state attorney general.

Learn more about whether you’re covered by the SCRA.

Learn more about the 6 percent interest rate protection for active duty servicemembers under the SCRA.

Learn more about your rights under the Servicemembers Civil Relief Act

I’m in the military and having trouble paying my auto loan. What should I know about auto repossession and protections under the Servicemembers Civil Relief Act (SCRA)?

The SCRA gives active-duty servicemembers certain legal and financial protections relating to installment contracts, like an auto loan or lease.

The SCRA prohibits creditors from repossessing personal property, including your vehicle, without a court order, based on breach of a contract you entered into prior to active-duty military service. For example, even if you violate your contract by failing to make your monthly payments, the creditor must first file a lawsuit and get an order from a judge before your vehicle can be repossessed. This protection only applies if you:

  • purchased or leased the vehicle, or other personal property, before entering military service; and
  • made a deposit or installment payment on the vehicle, or other personal property, before entering military service.

These federal protections under the SCRA are in addition to any other protections you might have under your state law.

Even if you’re protected by the SCRA from repossession without a court order, you could still be violating your contract if you do not pay. As a result, you may be charged fees associated with your failure to pay, such as a late fee. Your missed payments can be reported to credit reporting companies, and the creditor can try to collect the debt, including by filing a lawsuit against you.

If your creditor repossesses your vehicle and you have questions, contact your closest legal assistance (JAG) office for more information. You also may be able to get assistance from your state attorney general.

Learn more about your rights under the Servicemembers Civil Relief Act

Where can a member of the military or a spouse/dependent of a servicemember go for emergency funding or financial assistance?

Military Aid Societies (Army Emergency Relief, Navy-Marine Corps Relief Society, the Air Force Aid Society, and Coast Guard Mutual Assistance) provide grants and no-interest loans to certain servicemembers in need of essentials such as rent, food, utilities, and vehicle repair and replacement.

There are many resources to help you and your family during times of financial distress. For more information, please contact your relief society:

The American Red Cross also partners with Military Aid Societies to provide quality, reliable financial assistance to eligible applicants. If there is no Military Aid Society office located on your installation or in your area, you can contact the Red Cross’ Armed Forces Call Center at (877) 272-7337, or your local Red Cross chapter.

Some banks and credit unions now offer small, low-interest loans for servicemembers and their families if they are caught in a financial bind. These institutions have established programs and products designed to help you resolve your financial crisis, rebuild your credit rating, and establish savings. For more information, contact your local bank and/or credit union.

You can also meet with a free military financial counselor to get help with the financial challenges you face as a servicemember and receive resources to help you manage and plan your financial future.

Sources and further reading

The CFPB source passages are U.S. government work in the public domain. Fynoptic has selected, organized, and adapted the material for this guide, including corrections identified through the additional sources listed above. Sources accessed October 27, 2026. This use does not imply agency endorsement or affiliation.

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