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HomeMilitary and Veterans CodeDiv. 2Pt. 1Ch. 7.5§ 407 Military Service Contract Protections

§ 407 Military Service Contract Protections

Military and Veterans Code·California
AI Summary·Official Text·Key Terms·Related Statutes·References
AI SummaryVerified

§ 407 Military Service Contract Protections

This law protects people in the military from losing their property if they miss payments while serving. It says sellers can't just take back the property—they have to go to court first.

Key Takeaways

  • •If you're in the military, sellers can't take back property you're buying just because you miss payments while serving.
  • •Sellers must go to court first—they can't just take the property.
  • •The court can pause the case or make a fair deal if your military service affects your ability to pay.
  • •If someone breaks this law, they can be fined, pay damages, or even go to jail.

Example

A soldier buys a car but can't make payments while deployed overseas.

The car dealer can't just take the car back—they have to go to court and prove the soldier can still pay. The court might pause the case or make a fair deal for both sides.

AI-generated — May contain errors. Not legal advice. Always verify source.

Official Source
View on CA.gov

§ 407 Military Service Contract Protections

(a) No person who has received, or whose assignor has received, under a contract for the purchase of real or personal property, a deposit or installment of the purchase price, or a deposit or installment under the contract, from a person or from the assigner of a person who, after the date of payment of the deposit or installment, has entered into a period of military service, shall exercise any right or option under that contract to rescind or terminate the contract or resume possession of the property for nonpayment of any installment due or for any other breach of its terms occurring prior to or during the period of that military service, or for 120 days thereafter, except by action in a court of competent jurisdiction. (b) Upon the hearing of that action as provided in subdivision (a), the court may order the repayment of prior installments or deposits or any part, as a condition of terminating the contract and resuming possession of the property, or may, in its discretion, on its own motion, and shall, on application to it by the service member or some person on the service member’s behalf, order a stay of proceedings as the court deems just, unless in the opinion of the court, the ability of the defendant to comply with the terms of the contract is not materially affected by reason of the service; or it may make any other disposition of the case as may be equitable to conserve the interests of all parties. (c) Any person violating this section shall be liable for actual damages, reasonable attorney’s fees, and costs incurred by the injured party. (d) Any person who shall knowingly resume possession of property that is the subject of this section in a manner other than as provided in subdivision (a), or attempts to do so, is guilty of a misdemeanor, and shall be punishable by imprisonment not to exceed one year or by a fine not to exceed one thousand dollars ($1,000), or both. (Amended by Stats. 2018, Ch. 555, Sec. 9. (AB 3212) Effective January 1, 2019.)

Last verified: January 11, 2026

Key Terms

imprisonmentliabilityinstallmentfinemotiondamagesdefendantproperty

Related Statutes

  • § 406 Service Member Eviction Protection
  • § 408 Military Debt Protection
  • § 403 Military Service Legal Protections
  • § 409.2 Military Tax Collection Protection
  • § 409.3 Military Service Obligation Relief

References

  • Official text at leginfo.legislature.ca.gov
  • California Legislature. Military and Veterans Code. Section 407.
View Official Source