Skip to content
BOL Conferences
Thread Options
#1495917 - 01/14/11 09:16 PM Evidence of material adverse affect
complyshy Offline
Junior Member
Joined: Oct 2006
Posts: 40
If we granted the rate reduction to 6% effective with the call to active duty are we required to "verify the difference in salary while on active duty compared to the service member's civilian pay"? We are conducting a compliance review and the workpaper make it appear as a requirement.

Thank you for your assitance!
_________________________
--me

Return to Top
Lending to Servicemembers (SCRA, JWNDAA), War, Terrorism
#1495927 - 01/14/11 09:23 PM Re: Evidence of material adverse affect complyshy
John Burnett Offline
10K Club
John Burnett
Joined: Oct 2000
Posts: 40,086
Cape Cod
If your bank grants the reduction to 6% without a verification, I can't see that it would be a compliance concern. If you refused to grant the rate reduction without doing a verification of income difference, I'd see a compliance problem.
_________________________
John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
Bankers' Threads User #8

Return to Top
#1495931 - 01/14/11 09:29 PM Re: Evidence of material adverse affect John Burnett
complyshy Offline
Junior Member
Joined: Oct 2006
Posts: 40
Thanks for such a qucick response!
_________________________
--me

Return to Top
#2015749 - 05/22/15 04:50 PM Re: Evidence of material adverse affect complyshy
Compliance504 Offline
Platinum Poster
Joined: Dec 2008
Posts: 727
Tennessee
Do most of you ask for a verification of a decrease in income (not required)along with the military papers required by the regulation?
Last edited by Compliance504; 05/22/15 04:51 PM.
Return to Top
#2015780 - 05/22/15 06:12 PM Re: Evidence of material adverse affect complyshy
Adam F Offline
Gold Star
Adam F
Joined: Apr 2013
Posts: 420
VA
We do not. If they provide us with their military papers, then we go ahead and reduce their rates were applicable.
_________________________
It is better to act cautiously beforehand than to suffer afterward.

The answers I give are my opinions. Not legal advice.

Return to Top
#2015812 - 05/22/15 07:52 PM Re: Evidence of material adverse affect complyshy
Compliance504 Offline
Platinum Poster
Joined: Dec 2008
Posts: 727
Tennessee
Thanks NSFW......any others care to comment?

We currently have in our procedures to ask for this verification (signed statement) and I'm uncomfortable with it....I wanted to see what others do prior to recommending changing it.....

Return to Top
#2015814 - 05/22/15 08:00 PM Re: Evidence of material adverse affect complyshy
Dan Persfull Offline
10K Club
Dan Persfull
Joined: Aug 2002
Posts: 47,517
Bloomington, IN
Do most of you ask for a verification of a decrease in income

What are you doing with this verification? You cannot refuse to grant the rate relief based on that documentation without a court order. From section 527:

(c) CREDITOR PROTECTION- A court may grant a creditor relief from the limitations of this section if, in the opinion of the court, the ability of the servicemember to pay interest upon the obligation or liability at a rate in excess of 6 percent per year is not materially affected by reason of the servicemember's military service.
_________________________
The opinions expressed are mine and they are not to be taken as legal advice.

Return to Top
#2015836 - 05/22/15 08:58 PM Re: Evidence of material adverse affect complyshy
Compliance504 Offline
Platinum Poster
Joined: Dec 2008
Posts: 727
Tennessee
Honestly, Dan....we service an area with next to nil Military....

We have only had one such request....

From what I understand this was something that was put into our procedures some time ago.....I just wondered what other banks did to back my suggestion to remove it....

Return to Top
#2015907 - 05/26/15 01:32 PM Re: Evidence of material adverse affect complyshy
LillyNY Offline
Junior Member
Joined: Aug 2012
Posts: 48
Central NY
We do not require any verification that a Servicemember's income has decreased. Just the required military paperwork and we grant the the 6% rate cap benefit as appropriate.

Return to Top
#2017058 - 05/29/15 06:26 PM Re: Evidence of material adverse affect complyshy
ComplyCycle Offline
Gold Star
ComplyCycle
Joined: Dec 2014
Posts: 454
Upon receipt of required duty orders, we make all necessary account adjustments. Verification of material adverse impact is not required by my financial institution.

Return to Top
#2017565 - 06/02/15 02:36 PM Re: Evidence of material adverse affect complyshy
Compliance504 Offline
Platinum Poster
Joined: Dec 2008
Posts: 727
Tennessee
Thanks so much everyone! We are removing the verification from our procedures....

Return to Top

Moderator:  Andy_Z