Military Lending Act (MLA)

Posted By: TaraTLR

Military Lending Act (MLA) - 06/20/16 06:15 PM

I am doing my reading and research on the new MLA rules going into effect on 10/3/16. I know that the rule will not apply to residential mortgage transactions secured by a dwelling. What about land/lot loans? Any thoughts?
Posted By: raitchjay

Re: Military Lending Act (MLA) - 06/20/16 06:36 PM

Land/lot loans are covered transactions, if for consumer purpose.
Posted By: Andy_Z

Re: Military Lending Act (MLA) - 06/20/16 08:17 PM

If it isn't clearly an exception, it's covered.
Posted By: nbk2yj2

Re: Military Lending Act (MLA) - 06/22/16 03:52 PM

Getting into this late, appreciate any help.

Reading under what qualifies as a potential MLA loan:

"Loan is not expressly for the purchase of a car or other personal property and secured by the property being purchased.

Someone please interpret."

Also, what would need to be updated in our LOS systems pertaining to fees if the APR military or not would not exceed 36%
Posted By: Jade'sFire

Re: Military Lending Act (MLA) - 06/22/16 04:23 PM

If an active duty servicemember buys a car and gets a loan for the purchase money secured by that car= not a covered loan.
If they want to refinance a loan secured by an car= covered transaction
If they want to take out a loan to buy a motorcycle and secure the loan with their SUV= covered transaction
Posted By: Jade'sFire

Re: Military Lending Act (MLA) - 07/11/16 05:50 PM

I need to take another look at the question on the coverage of lot loans.

I have been challenged on my original stance:
"A loan to purchase a lot and to be secured by the lot being purchased is not a covered transaction"

Challenge: A loan to purchase a lot and to be secured by the lot being purchased is a covered transactions because a lot is not considered personal property. Therefore, all lot loans would be covered because they are using the definition of personal property to not include any land/dirt.
Posted By: raitchjay

Re: Military Lending Act (MLA) - 07/11/16 07:29 PM

The exemption is for loans secured by a dwelling. It is silent about real estate, which means being secured by real estate (but not a dwelling) doesn't give you an exemption.
Posted By: raitchjay

Re: Military Lending Act (MLA) - 07/11/16 07:33 PM

And correct....real estate is not personal property.
Posted By: cowgirlsrule

Re: Military Lending Act (MLA) - 07/11/16 08:10 PM

How is everyone identifying their borrower as a Servicemember?
Posted By: CULady

Re: Military Lending Act (MLA) - 07/11/16 08:18 PM

Credit report.

Possibly also using the batch check on the MLA website to check our entire membership twice a month to flag accounts. Still working out the details on that one.
Posted By: ComplyGuy

Re: Military Lending Act (MLA) - 07/12/16 02:06 PM

We do about 30-40 per month and are just planning on checking the website.

CU, or anyone using the credit report, have you heard anything from the credit agency showing what this will look like on the report and if there will be additional cost?
Posted By: Andy_Z

Re: Military Lending Act (MLA) - 07/12/16 02:38 PM

The credit report will get it's info from the database.

CULady, are you checking the MLA database for SCRA purposes? Once a loan is done, knowing the MLA applies serves no purpose unless it's an audit or QC function, so I'm curious.
Posted By: JWills, CRCM

Re: Military Lending Act (MLA) - 07/12/16 03:43 PM

Our CRA is not onboard as of yet. They have me down on their list of contacts once they are ready to go. Hopefully soon.
Posted By: CULady

Re: Military Lending Act (MLA) - 07/12/16 04:55 PM

We use Transunion and last I heard they said they will be ready to go in September. **fingers crossed** I believe they will have a special section in the alert area where it will indicate if they are a covered borrower or not. I believe there will be an additional cost, but have not heard what that will be.

Andy- We are a credit union, so whenever a new loan is added it will be added under the one account number. If we mark our accounts, we will know from the beginning whether or not MLA will apply. May or may not be helpful. But we can also use it to monitor when they are no longer a covered borrower and their open-end loans will no longer be considered covered and we can stop calculating the MAPR on a monthly basis.
Posted By: JWills, CRCM

Re: Military Lending Act (MLA) - 07/12/16 07:01 PM

Good to know CULady. We also use Transunion.
Posted By: ahkcompliance

Re: Military Lending Act (MLA) - 07/13/16 03:31 PM

We use Equifax and I have not seen anything if they will provide the code or not. I have sent in emails but not response. No one here seems to know who to contact.
Posted By: Andy_Z

Re: Military Lending Act (MLA) - 07/13/16 04:25 PM

CULady, that makes sense especially from the open-end disclosure requirements. I was tunnel visioning on pre-consummation disclosures.

The CRAs are negotiating contracts with the DoD last I heard. It may well be that they won't set pricing to you until this is done.
Posted By: Minion

Re: Military Lending Act (MLA) - 07/14/16 01:50 PM

We attended a webinar with Equifax and below is what they said.

Equifax expects to offer Release 1 (System-to-System 5.0 via 5.0 format extension) in Production environments by mid-July 2016, subject to completion of DoD/CRA final contract. Release 1 programming is available in Equifax's Customer Testing environment starting May 11, 2016. Release 2 programming in Customer Test environments will occur in waves within an estimated four to eight weeks after Release 1, in late summer/early fall, followed by Production implementations in stages August through September. Release 2 includes prescreen and account review products, online ACRO 6.0 and platform implementations (Interconnect®, NextGen, Decision Power, and Equifax ePort®).
Posted By: ahkcompliance

Re: Military Lending Act (MLA) - 07/15/16 08:50 PM

Thanks Minion! I've sent emails but we have not received any response.
Posted By: HRH Okie Banker

Re: Military Lending Act (MLA) - 07/26/16 03:11 PM

Originally Posted By Minion
We attended a webinar with Equifax and below is what they said.

Equifax expects to offer Release 1 (System-to-System 5.0 via 5.0 format extension) in Production environments by mid-July 2016, subject to completion of DoD/CRA final contract. Release 1 programming is available in Equifax's Customer Testing environment starting May 11, 2016. Release 2 programming in Customer Test environments will occur in waves within an estimated four to eight weeks after Release 1, in late summer/early fall, followed by Production implementations in stages August through September. Release 2 includes prescreen and account review products, online ACRO 6.0 and platform implementations (Interconnect®, NextGen, Decision Power, and Equifax ePort®).


Interestingly enough, I just went out and checked Eport and there is nothing on that websight that gives any information, yet, on MLA.
Posted By: Andy_Z

Re: Military Lending Act (MLA) - 07/27/16 03:01 PM

Last I knew they were still in contract negotiations, but that was weeks ago. This part of the process is moving slowly, but is obviously important.
Posted By: mtngrrl

Re: Military Lending Act (MLA) - 07/27/16 03:54 PM

With the effective date October 3, does that mean APPLICATIONS as of October 3 are covered, or loans CLOSED as of October 3? Trying to find it in the text but haven't so far...

And I'm still trying to get my head around checking for military status in the 30 days prior to application...because we're psychic or something...
Posted By: CULady

Re: Military Lending Act (MLA) - 07/27/16 04:03 PM

I think this was gone over in another thread, but I believe it will be loans closed on or after 10/3. So loans that were started before that will have to be checked if they will close/funded on or after 10/3. We are hoping the credit bureaus (for us Transunion) will be ready to go prior to that date.
Posted By: CULady

Re: Military Lending Act (MLA) - 07/27/16 04:05 PM

This thread is the one I was thinking of. Towards the bottom.
Posted By: RR Sarah

Re: Military Lending Act (MLA) - 07/27/16 07:07 PM

Originally Posted By mtngrrl
With the effective date October 3, does that mean APPLICATIONS as of October 3 are covered, or loans CLOSED as of October 3? Trying to find it in the text but haven't so far...

And I'm still trying to get my head around checking for military status in the 30 days prior to application...because we're psychic or something...


Here's how the 30 days prior to application was explained to me and it has to do with the credit report. Say you have a policy that says you can use a credit report obtained within the past 90 days for a new credit request (customer has another loan with you). The new rule says that you can only rely on that credit report if it was obtained within the 30 days prior to the new credit request if it is for a covered borrower.
Posted By: mtngrrl

Re: Military Lending Act (MLA) - 07/27/16 07:15 PM

Thank you for the reference, CULady.

My operations area is going to flip a lid when they finally hear me that they will have to access DOD or pull a credit report ON the day they get an application. I hope ABA is successful in getting that piece modified/clarified...and soon!
Posted By: ItsJustMe

Re: Military Lending Act (MLA) - 07/27/16 08:38 PM

RR Sarah can you post the citation for what you just explained? We were wondering if we would have to check military status at time of application AND time of funding/obligation/consummation (whatever you want to call it) but it appears that we may be okay if the borrower closes on the loan within 30 days of application. That is good news. But a citation would be helpful for me to read. Thanks!
Posted By: RR Sarah

Re: Military Lending Act (MLA) - 07/27/16 08:54 PM

From 232.5:

(3) Determination and recordkeeping; one-time determination permitted. A creditor who makes a determination regarding the status of a consumer by using one or both of the methods set forth in paragraph (b)(2) of this section shall be deemed to be conclusive with respect to that transaction or account involving consumer credit between the creditor and that consumer, so long as that creditor timely creates and thereafter maintains a record of the information so obtained. A creditor may make the determination described in this paragraph (b), and keep the record of that information obtained at that time, solely at the time—

(i) A consumer initiates the transaction or 30 days prior to that time;

(ii) A consumer applies to establish the account or 30 days prior to that time



What this says to me, in a nutshell, is that you can rely on information you may have already obtained prior to the application as long as it isn't more than 30 days prior to the application. So if the consumer has an established relationship with the bank and you already have a credit report (or verification from DOD database) that is no older than 30 days, you can use that instead of pulling new information.

If my bank has a credit request from a consumer that is back to back (maybe within 90 days of each other), our bank policy would allow us to use a credit report that was pulled within the last 90 days. With a covered borrower under MLA, we would only be able to use that report if it was pulled within the past 30 days.
Posted By: RR Sarah

Re: Military Lending Act (MLA) - 07/27/16 09:17 PM

I think the 30 day deal is clouding the issue maybe? Mandatory disclosures need to be given before the borrower becomes obligated so naturally, you're going to want to determine their status sometime before then. To me, the most obvious time, if we are going to rely on the credit report, would be when we pull the actual credit report. Sometimes that is the day they apply sometimes it is after that date. Someone correct me if I'm wrong but I haven't seen anywhere where it says we have to make that determination the DAY they apply (unless you are taking the application, approving the loan and disbursing funds on the same day).


§ 232.6 Mandatory loan disclosures.

(a) Required information. With respect to any extension of consumer credit (including any consumer credit originated or extended through the internet) to a covered borrower, a creditor shall provide to the covered borrower the following information before or at the time the borrower becomes obligated on the transaction or establishes an account for the consumer credit:
Posted By: mtngrrl

Re: Military Lending Act (MLA) - 07/27/16 09:30 PM

Sarah, I was concerned with regard to the timeframe for establishing military status, which was cited above as:

solely at the time—

(i) A consumer initiates the transaction or 30 days prior to that time;

(ii) A consumer applies to establish the account or 30 days prior to that time

I was not reading this to say that we could determine military status AFTER the application. Then again, what does "initiates the transaction" mean? That's how I came to the conclusion we have to pull DOD status on the date of application--but I'd be happy to be wrong.
Posted By: CULady

Re: Military Lending Act (MLA) - 07/27/16 10:41 PM

Mtngrrl - Just curious, if they weren't going to pull it at application, when were they going to pull it?
Posted By: mtngrrl

Re: Military Lending Act (MLA) - 07/27/16 10:44 PM

Within a day or so after the application is received by the loan officer. Based on our workflow, I don't believe the application always makes its way to the credit desk on the same day the application is received (to pull credit). Nor am I comfortable I'll be able to get the lenders to pull a DOD inquiry on the same day. So whether we do a DOD database inquiry or rely on the credit report, I still have a workflow issue.
Posted By: CULady

Re: Military Lending Act (MLA) - 07/27/16 11:26 PM

(B) Historic lookback prohibited. At any time after a consumer has entered into a transaction or established an account involving an extension of credit, a creditor (including an assignee) may not, directly or indirectly, obtain any information from any database maintained by the Department to ascertain whether a consumer had been a covered borrower as of the date of that transaction or as of the date that account was established.

I think that if it took a day to go from a teller to a loan officer and then the covered borrower check was made, I believe you would still be covered. This suggests that a "lookback" can not be done "as of the date of that transaction or as of the date that account was established." As long as the loan account isn't opened first, then the check is made, I think you'd be okay.

Unfortunately, it isn't very clear on that. Anyone else want to weigh in on this interpretation?
Posted By: ItsJustMe

Re: Military Lending Act (MLA) - 07/28/16 01:19 PM

I think CULady and RR Sarah are spot on. Perhaps what mtngrrl is tripped on with the comment about after the application is having to track open end lines and determining if the borrower is still in the military?
Posted By: mtngrrl

Re: Military Lending Act (MLA) - 07/28/16 03:04 PM

I'm tripping on "at application". Anyone want to try to define "at"? Ugh.

I do believe we can verify within a day or two of receiving the app.
Posted By: Andy_Z

Re: Military Lending Act (MLA) - 07/28/16 03:28 PM

"established the account" is akin to consummation to me. And it serves no purpose to lookback as the horses are out of the barn so to speak. You can't go back and make disclosures at the point, it's too late.

Is this what you're asking?
Posted By: mtngrrl

Re: Military Lending Act (MLA) - 07/28/16 03:35 PM

Andy, I'm concerned about the date on which we need to verify military status in order to take advantage of safe harbor. The requirement is to verify military status at the time:

(ii) A consumer applies to establish the account or 30 days prior to that time

Because there's a firm "30 day" statement, I'm assuming there's a specific date from which you would count back, i.e. the date the app is received. So I've been reading that for new applicants, we would need to determine status no later than the date the application was received.

Sorry if I'm beating a dead horse here, folks...just trying to get it right the first time!

_________________________
Be kind; everyone you meet is fighting a hard battle.
--all opinions are my own--
Posted By: ItsJustMe

Re: Military Lending Act (MLA) - 07/28/16 03:42 PM

mtngrrl... maybe explaining our process will help. When someone applies for a loan, we run a credit report at that point. Our CRA will indicate if someone is a covered borrower so we will know immediately at the time they are applying. However, they don't always "consummate" or close the loan the same day they apply. If they close the loan within 30 days of the date of application (which is when we relied on the credit report to determine "covered borrower"), we can rely on that same information without having to determine a second time whether the consumer is covered. It seems that if your process is to determine if a consumer is a covered borrower a couple of days after the date they apply for credit BUT before they become obligated to the loan, you should be covered. Did that help?
Posted By: Andy_Z

Re: Military Lending Act (MLA) - 07/28/16 04:01 PM

What ^^^^ said. I believe this is designed that such that you get the app, do the check and proceed. But if the loan takes longer to close, >30 days, you need to refresh the MLA check.

I would also add that if there was any suspicion that the person was going to become a covered borrower between app and closing, the fact that the check was negative at app could be moot. Say He and She apply and the loan qualifies based on one persons income, but it is noted the other person is joining the military and reporting tomorrow so this loan will be POA when closed in a few days, you'd have issues. (Not the best example, but I hope you get the point.)
Posted By: mtngrrl

Re: Military Lending Act (MLA) - 07/28/16 04:13 PM

Thank you all very much. Yes, I feel better, and I'll bury the poor horse now.
Posted By: CULady

Re: Military Lending Act (MLA) - 07/28/16 04:30 PM

I hadn't even thought about the covered borrower check "expiring" after 30 days. ::HEAD:DESK:: I learn something new everyday from these forums!

Off to email loan operations to get that added to the super long list of procedural changes... crazy
Posted By: ahou

Re: Military Lending Act (MLA) - 07/28/16 05:01 PM


Preamble pg 97

The creditor needs to undertake this covered-borrower check only once—namely, only at the time that
(i) a consumer initiates the transaction,
(ii) a consumer applies to establish the account, or
(iii) the creditor develops or processes, with respect to a consumer, a firm offer of credit [prescreen offer]that (among the specific criteria used by the creditor for the offer) includes the status of the consumer as a covered borrower.

The "30 day prior" reference is explained in the preamble as " In order to facilitate a creditor’s process for responding to a consumer’s inquiry about a loan—which could occur days or a few weeks before the consumer’s application for that loan—as well as to reduce the traffic on the MLA Database, § 232.5(b)(3)(i)-(ii) permit the creditor to make a determination and keep a record of the information so obtained 30 days prior to the date of the transaction or the date the consumer applies to establish an account."

The bank is prohibited from checking the status of a consumer in regard to a pre-existing transaction or loan.

Preamble pg 98
Prescreen Offers are the only situations in which the borrower check has a time limitation. (consumer has to respond within 60 days after the bank provides the offer to the consumer)
Posted By: CULady

Re: Military Lending Act (MLA) - 07/28/16 07:48 PM

Ah yes! It does cover that. Whew! I was wondering how I had missed that.

323.5(b)(3) Determination and recordkeeping; one-time determination permitted. A creditor who makes a determination regarding the status of a consumer by using one or both of the methods set forth in paragraph (b)(2) of this section shall be deemed to be conclusive with respect to that transaction or account involving consumer credit between the creditor and that consumer, so long as that creditor timely creates and thereafter maintains a record of the information so obtained.
Posted By: parr04

Re: Military Lending Act (MLA) - 07/29/16 03:28 PM

Will the credit report identify military dependents? Looks as if it would be very easy to miss someone who is a spouse, child, or in- laws.
Posted By: CULady

Re: Military Lending Act (MLA) - 07/29/16 03:33 PM

Covered in this thread.

Originally Posted By CULady
The DOD will have the records of the dependents. Pay is based on how many dependents you have and the DOD will have to have their name, DOB, SSN, etc. So if the DOD has that info, then it will be available on the credit report and the MLA website.

Again, our responsibility is to use on the of the two methods for safe harbor. If it's not there, due to military member omission, DOD mistake, etc, it's not really our problem AS LONG AS you retain the documentation to prove safe harbor.
Posted By: Laurlee

Re: Military Lending Act (MLA) - 08/10/16 07:16 PM

It is rare for us to have an APR that exceeds 36%. We are considering providing the MAPR disclosure on all applicable transactions regardless if the borrower is a covered borrower or not. Has anyone else considered this?
Posted By: raitchjay

Re: Military Lending Act (MLA) - 08/10/16 07:19 PM

Just because it's rare for you to have an APR that exceeds 36% (i think it's rare for all banks) does't mean you can't exceed 36% on the MAPR--they aren't calculated identically. A lot easier to get there on the MAPR.
Posted By: Laurlee

Re: Military Lending Act (MLA) - 08/10/16 07:49 PM

I do agree to that statement.

The reason I'm considering disclosing the MAPR to all is because we do not always pull new credit reports for loans (e.g CD loans) and we will be charged an additional fee by the Credit Bureau for this check (which we do not pass along to the borrower). So I think we would save time and money by disclosing the MAPR to all applicants on all applicable transactions.

The risk I see with doing this is that we have to make sure our MAPR does not exceed 36% for anyone. However, we could build in our procedures to check the database if MAPR exceeds 36%.

Anyone else considering this approach?
Posted By: raitchjay

Re: Military Lending Act (MLA) - 08/10/16 07:50 PM

Have you considered using the DOD database yourself, instead of relying on the credit bureaus? No charge to use it yourself, and it isn't hard. I would have a hard time getting behind the machine gun approach you're suggesting. JMO.
Posted By: Andy_Z

Re: Military Lending Act (MLA) - 08/10/16 08:10 PM

From a marketing standpoint why would you want to quote a higher than the APR rate to a borrower if it wasn't necessary?

Consider just adding credit insurance costs to the finance charge and see what that does to an APR. In an example I used when teaching at the TBA, was a $500 loan for 6 months has an APR going from 24.84% to 39.73%. Your results can vary based on the insurance costs, but you get the idea.
Posted By: CULady

Re: Military Lending Act (MLA) - 08/10/16 08:12 PM

As discussed in other threads, you can't do CD/Savings secured loans. So you will still need to be able to check at application for the covered borrower so you are not offering products that they can not have.

Agree with raitchjay. It just doesn't make sense to me to not check at application. For the instances that you don't pull credit, I would do a check on the DOD MLA site. All it takes is a SSN, DOB and last name, click search and you have your result.

But as for the forms, we will have the MLA disclosures on our forms that will be used for all borrowers. Not my preference, but not my call either.
Posted By: Andy_Z

Re: Military Lending Act (MLA) - 08/10/16 08:14 PM

Originally Posted By Laurlee
I do agree to that statement.

The reason I'm considering disclosing the MAPR to all is because we do not always pull new credit reports for loans (e.g CD loans) and we will be charged an additional fee by the Credit Bureau for this check (which we do not pass along to the borrower). So I think we would save time and money by disclosing the MAPR to all applicants on all applicable transactions.

The risk I see with doing this is that we have to make sure our MAPR does not exceed 36% for anyone. However, we could build in our procedures to check the database if MAPR exceeds 36%.

Anyone else considering this approach?


If you made a CD secured loan and the MAPR was <36%, you'd still have a MLA problem if a borrower was covered because you won't, under current interpretations, be able to make that loan under the MLA.
Posted By: RR Sarah

Re: Military Lending Act (MLA) - 08/10/16 08:16 PM

I think we're going to check for military/dependent status at application on every loan. If a covered borrower, procedures would kick in.
Posted By: bcompliance

Re: Military Lending Act (MLA) - 08/15/16 04:08 PM

Just curious, are you going to be checking the military status at application on loans that are exempt transactions?

For example, our indirect lending program would be exempt on all loans. Do we still need to check the database even though these are exempt?

what about commercial loans?
Posted By: Jade'sFire

Re: Military Lending Act (MLA) - 08/15/16 04:39 PM

We will not. If the loan being applied for is not covered by the MLA then a covered borrower check will not be made.
Posted By: RR Sarah

Re: Military Lending Act (MLA) - 08/15/16 05:47 PM

I guess it all depends on how the credit bureaus are going to handle this. If military status shows up on all reports, why not check for it then? We are not in a region where we see a lot of service members so it is kind of nice to know about them from the get go. As far as our indirect lending portfolio...not sure if we will check those up front because the purchase transaction wouldn't be covered under MLA but we do check those when the collection process starts so that is just a matter of timing.

Procedures are still in a state of flux though since we are waiting on the September update of our loan processing software before we can test everything.
Posted By: Tracey, CRCM

Re: Military Lending Act (MLA) - 08/15/16 05:55 PM

Does anyone have any sort of implementation checklist and/or draft procedures they can share?
Posted By: bcompliance

Re: Military Lending Act (MLA) - 08/15/16 06:05 PM

At this point, my procedures are fairly basic as we are waiting our vendors to inform us if we will be able to pull through the credit bureau.

here is basically what I have covered so far:

1. are they a covered borrower - check CB or DOD site
2. is this a covered loan - examples of exempt transactions and examples of covered loans
3. is the mapr under 36%
4. give proper disclosures - oral and in a form they can keep
Posted By: bcompliance

Re: Military Lending Act (MLA) - 08/15/16 06:06 PM

We are not checking our indirect loans as they will be exempt under the rule, and our indirect team has a different vendor than retail, mortgage, and commercial (we won't be checking commercial either).
Posted By: Tracey, CRCM

Re: Military Lending Act (MLA) - 08/15/16 06:21 PM

Thanks bcompliance- do you have a script for the oral disclosure drafted yet? And what are you using to meet the "form they can keep"-
Posted By: raitchjay

Re: Military Lending Act (MLA) - 08/15/16 06:23 PM

The script for the oral disclosure can be the model statement:

3) Model statement. A statement substantially similar to the following statement may be used for the purpose of paragraph (a)(1) of this section: "Federal law provides important protections to members of the Armed Forces and their dependents relating to extensions of consumer credit. In general, the cost of consumer credit to a member of the Armed Forces and his or her dependent may not exceed an annual percentage rate of 36 percent. This rate must include, as applicable to the credit transaction or account: The costs associated with credit insurance premiums; fees for ancillary products sold in connection with the credit transaction; any application fee charged (other than certain application fees for specified credit transactions or accounts); and any participation fee charged (other than certain participation fees for a credit card account)."

Won't your LOS have this form with this language?
Posted By: Tracey, CRCM

Re: Military Lending Act (MLA) - 08/15/16 06:24 PM

That is my problem raitchjay- they can't tell me yet! waiting on updates from them.
Posted By: raitchjay

Re: Military Lending Act (MLA) - 08/15/16 06:25 PM

Ahhh.
Posted By: bcompliance

Re: Military Lending Act (MLA) - 08/15/16 06:30 PM

Thanks bcompliance- do you have a script for the oral disclosure drafted yet? And what are you using to meet the "form they can keep"-

I am hoping that our vendors will have a form that prints, but I am not sure as of now. As of the oral disclosure, they will be reading the paragraph raitchjay cited above.
Posted By: RR Sarah

Re: Military Lending Act (MLA) - 08/15/16 06:35 PM

I'm assuming that our software vendor will provide the "form they can keep". As far as the oral disclosure, I'm thinking about having the model notification printed on index cards and laminated for staff so they can have it handy. Just my preliminary thoughts on the oral disclosures though. We won't have a separate 800 number so those calls will be coming in on the bank's general 800 line. I'm thinking I'll probably train staff that answer the phone to provide the oral disclosures but not 100% sure on that.
Posted By: raitchjay

Re: Military Lending Act (MLA) - 08/15/16 06:37 PM

I don't anticipate using an 800 number at all--it just doesn't seem that hard to me to have staff read them the model language at the loan closing.
Posted By: bcompliance

Re: Military Lending Act (MLA) - 08/15/16 06:42 PM

I can already hear the complaining with the added step in the procedures, but I agree with raitchjay. They can read it to covered borrowers at closing and explain the payment stream. It will take less that 30 seconds. We also don't have enough covered borrowers to justify the 800 number...
Posted By: Tracey, CRCM

Re: Military Lending Act (MLA) - 08/16/16 02:33 PM

How are you all going to document the delivery of the oral disclosures?
Posted By: raitchjay

Re: Military Lending Act (MLA) - 08/16/16 02:36 PM

I don't think we will--i'll put it in our procedures and if questioned about it, i'll hand a copy of the procedures to whomever is asking.
Posted By: ScoutLaRue

Re: Military Lending Act (MLA) - 08/16/16 02:41 PM

Our bank already has our own toll free 800 number that connects to front desk. I thought I heard in an MLA webinar we could use that number and let the borrower know they can have the information read to them by calling it? It seems easier to just add the 800# to the docs, and have the LO let the borrower know they can call.

How many will call?....my guess is zero.
Posted By: bcompliance

Re: Military Lending Act (MLA) - 08/16/16 03:35 PM

Ditto what raitchjay said.... Procedures.
Posted By: ComplyGuy

Re: Military Lending Act (MLA) - 08/16/16 03:58 PM

Our vendor's written disclosure has a signature line at the bottom that states the borrower acknowledges receiving the written disclosure and that they were provided the disclosure orally. We plan to have that signed.
Posted By: Jade'sFire

Re: Military Lending Act (MLA) - 08/16/16 05:54 PM

Our process is the same as Compliowa. We will keep a signed copy in the file and make sure the borrower gets a copy to keep.
Posted By: HRH Okie Banker

Re: Military Lending Act (MLA) - 08/16/16 06:10 PM

Our software vendor (they whom shall not be named) tried to inform us that since we didn't currently have any active duty military customers and therefore we did not need the MLA updates at this time and they've put us down for updates during next years' annual update (summer '17).

We challenged this with a accurate explanation of why and it appears that we have now been moved WAY up on the list to being done any day now.
Posted By: peony

Re: Military Lending Act (MLA) - 08/17/16 12:51 PM

we know that we are going to provide the toll-free number with the MAPR statement and the number will give the covered borrower the MAPR statement orally but do we have to provide payment schedule orally as well? The way I read the rule, I was thinking it would be satisfied once you give them the Reg Z disclosures that includes the payment schedule.
Posted By: CompliantOkie

Re: Military Lending Act (MLA) - 08/17/16 01:48 PM

The payment schedule must be presented orally as well. That's what is keeping us from just setting up a recording of the MAPR statement and providing a toll free number.

For those of you providing a toll free number, do you plan on tracking who actually calls and gets the oral disclosures or is providing a way for them to receive the disclosures enough?
Posted By: peony

Re: Military Lending Act (MLA) - 08/17/16 02:23 PM

Can we tell the payment schedule to the covered borrower at closing and provide the statement along with the toll free number to receive the statement orally??