Skip to content
BOL Conferences
Thread Options
#2243341 - 09/30/20 03:11 PM Payday Lending Rule
MusicCityCRCM Offline
100 Club
Joined: Apr 2015
Posts: 228
Has anyone been able to find a definition for 'accommodation loan' as it pertains to the Payday Lending Rule?

Return to Top
Lending Compliance
#2243350 - 09/30/20 04:27 PM Re: Payday Lending Rule MusicCityCRCM
Bville Offline
Diamond Poster
Bville
Joined: May 2001
Posts: 1,282
Out West
1041.3(f) Accommodation loans. Accommodation loans are conditionally exempt from the requirements of this part. Accommodation loan means a covered loan if at the time that the loan is consummated:

(1) The lender and its affiliates collectively have made 2,500 or fewer covered loans in the current calendar year, and made 2,500 or fewer such covered loans in the preceding calendar year; and

(2)(i) During the most recent completed tax year in which the lender was in operation, if applicable, the lender and any affiliates that were in operation and used the same tax year derived no more than 10 percent of their receipts from covered loans; or

(ii) If the lender was not in operation in a prior tax year, the lender reasonably anticipates that the lender and any of its affiliates that use the same tax year will derive no more than 10 percent of their receipts from covered loans during the current tax year.

(3) Provided, however, that covered longer-term loans for which all transfers meet the conditions in §1041.8(a)(1)(ii), and receipts from such loans, are not included for the purpose of determining whether the conditions of paragraphs (f)(1) and (2) of this section have been satisfied.

Also look at the commentary

Return to Top
#2243366 - 09/30/20 04:57 PM Re: Payday Lending Rule MusicCityCRCM
MusicCityCRCM Offline
100 Club
Joined: Apr 2015
Posts: 228
I understand that part of determining whether an accommodation loan is exempt or not based on loans made and receipt, but what we are trying to determine is how they define the word 'accommodation' and when a loan would be classified as such.

Return to Top
#2243451 - 10/01/20 03:49 PM Re: Payday Lending Rule MusicCityCRCM
Bville Offline
Diamond Poster
Bville
Joined: May 2001
Posts: 1,282
Out West
Look back in the definitions in 1041.2. There are three types of covered loans. If the covered loans taken together meet the requirements in 1041.3(f), then the covered loans you made are accommodation loans. (That's a simplified explanation, but I think it gets you there.)

Return to Top
#2244481 - 10/22/20 06:30 PM Re: Payday Lending Rule MusicCityCRCM
TeamComply Offline
Platinum Poster
Joined: Aug 2016
Posts: 540
So if we make hundreds of consumer loans each year, and have 11 single payment covered long-term balloon loans made in 2020 (which is far less than 10% of our receipts), so these would all be considered "accommodation loans" and thus we would be exempt from the PayDay Lending rules, correct????

Return to Top
#2244499 - 10/22/20 10:38 PM Re: Payday Lending Rule TeamComply
C4C Offline
New Poster
Joined: Jan 2016
Posts: 23
That's the way that I interpreted that section, but would also like some clarification.

Return to Top

Moderator:  Andy_Z