The purchase money loan is not a consumer credit and the MLA requires disclosures on consumer credit, in layman's terms. As to GAP, well, (read this like Harry Callihan is talking to you) "do you feel lucky, laymen, well do ya?" GAP wasn't specifically defined as a prohibited cost removing the transaction from the definition of consumer credit. Different banks interpreted it differently so the DoD added it specifically to say "this is not a valid cost for the exemption." Now they backed off of that and said it's being reviewed. Do you take that to mean it is an acceptable cost, or that it's being studied and may, sometime between now and eternity be considered an unacceptable cost?
Consumer credit does not mean:
(i) A residential mortgage, which is any credit transaction secured by
an interest in a dwelling, including a transaction to finance the
purchase or initial construction of the dwelling, any refinance
transaction, home equity loan or line of credit, or reverse
(ii) Any credit transaction that is expressly intended to finance the
purchase of a motor vehicle when the credit is secured by the
vehicle being purchased;
(iii) Any credit transaction that is expressly intended to finance the
purchase of personal property when the credit is secured by the
property being purchased;
(iv) Any credit transaction that is an exempt transaction for the
purposes of Regulation Z (other than a transaction exempt under
12 CFR 1026.29) or otherwise is not subject to disclosure
requirements under Regulation Z; and
(v) Any credit transaction or account for credit for which a creditor
determines that a consumer is not a covered borrower by using a
method and by complying with the recordkeeping requirement
set forth in § 232.5(b).
My opinions are not necessarily my employers.
Rules and Regs minus Relationships equals Resentment and Rebellion. John Maxwell