Don't Default on Military Families Act - Amends the Servicemembers Civil Relief Act to, during a funding gap affecting the Armed Forces: (1) require a court order to evict a servicemember (or dependents) from a primary residence during a period of the servicemember's military service (currently, such a court order is required only when monthly rent for the residence is below a specified amount); (2) bar subjecting such premises to distress; and (3) prohibit, after a servicemember enters military service, rescinding or terminating a contract for the purchase, lease, or bailment of real or personal property for a breach occurring before or during that person's military service (currently, such protections apply only when a servicemember pays a deposit or installment before entering military service).
Modifies existing requirements for staying proceedings, adjusting obligations, or selling, foreclosing, or seizing property for a breach of obligation when an underlying mortgage or other secured interest on real or personal property originates before a funding gap that is the cause of such actions (currently, such protections apply only when the obligations originated before the period of the servicemember's military service).
Prohibits a servicemember's failure or delay to make a mortgage payment (without regard to other considerations) from providing a basis for an adverse credit report if in good faith such servicemember notifies the creditor that such a funding gap is the cause of the failed or delayed payment.