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#2029511 - 07/24/15 02:57 PM Final Rule MLA amendment
ComplyGuy Offline
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Any thoughts or discussion on the newly released Final Rule?

There is over a year until compliance is required, but this will be a big change for our bank. Previously we did not extend "consumer credit" as defined by the reg. But a lot of loans fall under the expanded definition.
Last edited by ehoffman; 07/24/15 04:13 PM.
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Lending to Servicemembers (SCRA, JWNDAA), War, Terrorism
#2029771 - 07/24/15 10:11 PM Re: Final Rule MLA amendment ComplyGuy
Andy_Z Offline
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I plan of doing a webinar very soon. The types of credit, the components of the finance charge and the emphasis the examiners put on servicemembers, especially under the SCRA, should have many bankers looking hard at this.

My question is, will anyone pay attention until after TRID is mostly put to bed?
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#2030574 - 07/29/15 07:35 PM Re: Final Rule MLA amendment ComplyGuy
Mel in WA Offline
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Trying to wrap my brain around how to implement this, based on the type of loans that are covered.

Andy - To be honest, probably won't think about the details until after TRID. Hope you will offer your webinar again late 2015/early 2016.

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#2030967 - 07/31/15 03:52 AM Re: Final Rule MLA amendment ComplyGuy
Tesla Offline
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Yep, I need to get TRID nailed down before I can put any real time and effort into learning about MLA. I agree with Mel- hope you can do the webinar again a little later.
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#2031265 - 08/02/15 08:01 PM Re: Final Rule MLA amendment ComplyGuy
Andy_Z Offline
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To meet a need I'll have an MLA this month, but likely will do it again early next year.
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#2035791 - 08/26/15 07:22 PM Re: Final Rule MLA amendment Andy_Z
swiggles Offline
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So basically transactions that will now be included for a "covered member" and dependents are any unsecured loans, any secured loans not secured by property being purchased, RLOCs (other than HELOCs)??? So what if our doc prep software does not have the capability to calculate MAPR? We just can't make the loans? And what about the 182 day "title loan" rule? It will be history?
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#2036243 - 08/28/15 03:27 PM Re: Final Rule MLA amendment swiggles
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#2036284 - 08/28/15 06:03 PM Re: Final Rule MLA amendment ComplyGuy
Kathleen O. Blanchard Offline

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Everything except real estate secured, and loans that finance the purchase of the collateral securing the loan (so an auto purchase, rv purchase, etc. loan is exempt). The time frames on product descriptions are history. Title loans are subject to the rules regardless of length.

Closed end, open end (including cards, OD lines of credit, personal lines of credit)...all covered except as noted.
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#2037683 - 09/09/15 04:06 PM Re: Final Rule MLA amendment Kathleen O. Blanchard
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In reviewing the final rule, I was a little confused as to what they mean by "home-secured". I was leaning toward primary residence. Kathleen B, are you interpreting it to mean any dwelling secured loan being exempt????

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#2037817 - 09/10/15 02:28 PM Re: Final Rule MLA amendment ComplyGuy
Still Smiling Offline
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I believe the exemption is for a dwelling secured loan regardless if attached to real property or not, which could be rental or primary, right?
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#2039840 - 09/22/15 02:54 PM Re: Final Rule MLA amendment ComplyGuy
terpsfan Offline
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For an unsecured loan can we inquire if they are married to a servicemember when Reg B prohibits us from getting marital status? Also to check the database I assume we will need to collect the servicemember's social even if they are not on the loan to check the database.

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#2053703 - 12/10/15 11:12 PM Re: Final Rule MLA amendment ComplyGuy
Wannaknow Offline
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doesn't the MLA and the CRA overlap? So the 6% rate wins??

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#2053704 - 12/10/15 11:19 PM Re: Final Rule MLA amendment Still Smiling
Kathleen O. Blanchard Offline

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Quote:
Originally Posted By Still Smiling
I believe the exemption is for a dwelling secured loan regardless if attached to real property or not, which could be rental or primary, right?


Quote:
doesn't the MLA and the CRA overlap? So the 6% rate wins??



For some reason, the follow ups here blew past me.

The revised MLA regulations cover all consumer purpose credit except:

loans secured by 1-4 family dwellings whether or not the loan is also secured by land (meaning mobile/manufactured homes on or to be placed upon leased land are covered), and
loans to finance the purchase of personal property when the loan is secured by the personal property purchased (for example, motor vehicles, recreational vehicles, appliances, furniture, jewelry, etc.)

The two laws exist side by side, with major differences. The 6% for SCRA is an interest rate (which could include some fees in some cases). The MAPR for MLA is an APR calculation that includes many fees. Covered borrowers and transactions also differ.
Last edited by Kathleen B; 12/10/15 11:22 PM.
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#2053949 - 12/14/15 02:32 PM Re: Final Rule MLA amendment ComplyGuy
JC Offline
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We have a courtesy overdraft that we extend, would that be covered? the client does not apply for it.

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#2053954 - 12/14/15 02:39 PM Re: Final Rule MLA amendment ComplyGuy
Kathleen O. Blanchard Offline

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No, the MLA would not apply to a single overdraft that was approved but it does apply to a true OD line of credit.
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#2054483 - 12/16/15 06:34 PM Re: Final Rule MLA amendment ComplyGuy
JC Offline
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Couple of questions:


1. Does anyone know how we will identify the dependent or spouse of active duty? Does the DOD Database give us that information?

2. Our training group shared a draft deck for me to review and under limitations they stated "No Vehicle Title Loan" unless for purchase. I am a little confused. Maybe I have a different definition of a vehicle title loan. I assumed it was a loan using the vehicle for collateral but using the proceeds for something else.

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#2061527 - 02/01/16 06:13 PM Re: Final Rule MLA amendment ComplyGuy
Jade'sFire Offline
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I just took another look at the definition of a covered loan, It thought all real estate was exempt, but then I re-read it and it is just dwellings.

So a consumer purpose cash out loan secured by an unimproved lot would be covered.
Does that sound right to others?
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#2061570 - 02/01/16 07:41 PM Re: Final Rule MLA amendment ComplyGuy
CULady Online
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I hadn't thought of that either... But I agree with your interpretation.

Now to follow up with Mortgage and make sure they understand this as well...

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#2061572 - 02/01/16 07:41 PM Re: Final Rule MLA amendment ComplyGuy
John Burnett Offline
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Sounds right to me.
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#2063491 - 02/10/16 04:05 PM Re: Final Rule MLA amendment Wannaknow
ItsJustMe Offline
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Originally Posted By Wannaknow
doesn't the MLA and the CRA overlap? So the 6% rate wins??


Building on Wannaknow's question... and perhaps trying to answer my own question.... The 6% SCRA rate only applies if the loan was applied for prior to the servicemember entering the service, correct? So, if the same servicemember applies for a new loan while he/she is in the service, they do not qualify for the 6% but the new loan cannot exceed 36%, correct?

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#2063494 - 02/10/16 04:10 PM Re: Final Rule MLA amendment ComplyGuy
CULady Online
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That is correct.

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#2063500 - 02/10/16 04:24 PM Re: Final Rule MLA amendment ComplyGuy
ItsJustMe Offline
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Thank you for the sanity check CULady!

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#2064498 - 02/16/16 08:09 PM Re: Final Rule MLA amendment ComplyGuy
raitchjay Online
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OK
Can someone just generally explain this section to me a bit? It seems to me to be saying you can't refinance a loan to a covered borrower (the exception being that you can refinance a loan that was made prior to them being a covered borrower)...is that right? If so, what are the practical implications? Thanks.

Title 10 U.S.C. 987 makes it unlawful for any creditor to extend consumer credit to a covered borrower with respect to which:

(a) The creditor rolls over, renews, repays, refinances, or consolidates any consumer credit extended to the covered borrower by the same creditor with the proceeds of other consumer credit extended by that creditor to the same covered borrower. This paragraph shall not apply to a transaction when the same creditor extends consumer credit to a covered borrower to refinance or renew an extension of credit that was not covered by this paragraph because the consumer was not a covered borrower at the time of the original transaction. For the purposes of this paragraph, the term “creditor” means a person engaged in the business of extending consumer credit subject to applicable law to engage in deferred presentment transactions or similar payday loan transactions (as described in the relevant law), provided however, that the term does not include a person that is chartered or licensed under Federal or State law as a bank, savings association, or credit union.
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#2064502 - 02/16/16 08:14 PM Re: Final Rule MLA amendment ComplyGuy
CULady Online
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Just reading the last sentence, I THINK it just applies to non-bank/credit union entities. Like a payday loan place. This is to keep them from continually refi/renewing the same debt.

I would look to the definitions of what you are reading. Does it have a better laid out definition of creditor there..?
Last edited by CULady; 02/16/16 11:29 PM. Reason: Typo...
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#2064505 - 02/16/16 08:20 PM Re: Final Rule MLA amendment ComplyGuy
raitchjay Online
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OK
Ok, yes, i see what you're saying. The confusion is that the disclaimer only comes at the end....that part i quoted is the very first paragraph of that section (232.8), which i thought meant that "creditor" defaulted back to the general definition in 232.3. Thanks.
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