It is not required under the MLA regulation. But let's suppose that you use Vendor X ( it could be a credit bureau or some other third-party service provider) to do your MLA checks and for some reason, Vendor X is accessing month-old data. You learn that three borrowers whose loans closed in December were, in fact, on active duty when they signed their loan notes, but Vendor X reported that were not on the MLA database when they checked, the day you received the applications. To add insult to injury, you find out they were all in the service when they applied and no one discussed their military status then or later.
If the bank had tested Vendor X's procedures, it could have learned about their use of stale data.
That's the sort of thing your regulator wants to know you have checked for.
John S. Burnett
Fighting for Compliance since 1976
Bankers' Threads User #8