MLA Oral Disclosures -- Read to all borrowers?

Posted By: Karen B.

MLA Oral Disclosures -- Read to all borrowers? - 07/28/16 01:34 PM

If the oral disclosures are given over the phone to a borrower covered under the MLA, and that borrower's spouse is also a borrower (and as a dependent is also covered by the MLA), does the phone then need to be handed over to the spouse so that the oral disclosures can be given to that person as well? Or do the oral disclosures only need to be given to one borrower in a phone situation?
Posted By: Andy_Z

Re: MLA Oral Disclosures -- Read to all borrowers? - 07/28/16 02:35 PM

I had not considered this. The law says the disclosures are made to a covered borrower, but it never says they must be made to only one if there is more than one covered borrower. The only conclusion I could see is that they be made to each.
Posted By: Karen B.

Re: MLA Oral Disclosures -- Read to all borrowers? - 07/28/16 03:25 PM

Thank you, Andy. Our bankers are gonna love this!
Posted By: Indy Banker

Re: MLA Oral Disclosures -- Read to all borrowers? - 08/01/16 05:15 PM

Yes, the way the law reads it would be required to provide the oral disclosures - or a toll-free number to obtain the disclosures - to each covered borrower on the loan. If not all borrowers on the loan are "covered" borrowers, however, I suppose it would only need to be provided to the covered borrower.
Posted By: BrendaW

Re: MLA Oral Disclosures -- Read to all borrowers? - 08/03/16 05:06 PM

I am confused as I see the toll-free number to be only for mail or internet transactions. If it is not a mail or internet situation, then it appears the phone number solution for oral disclosures is not applicable.


(b)(2) Oral disclosures. The creditor also shall provide the disclosures required by paragraphs (a)(1), (a)(3) and (a)(4) of this section orally before consummation. In mail and internet transactions, the creditor satisfies this requirement if it provides a toll-free telephone number on or with the written disclosures that consumers may use to obtain oral disclosures and the creditor provides oral disclosures when the covered borrower contacts the creditor for this purpose.
Posted By: Minion

Re: MLA Oral Disclosures -- Read to all borrowers? - 08/03/16 05:40 PM

This is what I found it in the federal register on page 43610 and under section §232.6 -- Mandatory loan disclosures of the rule itself.

(2) Oral disclosures. (i) In general.
The creditor also shall orally provide the information required by paragraphs (a)(1) and (3) of this section.
(ii) Methods to provide oral disclosures. A creditor may satisfy the requirement in paragraph (d)(2)(i) of this section if the creditor provides—
(A) The information to the covered borrower in person; or
(B) A toll-free telephone number in order to deliver the oral disclosures to a covered borrower when the covered borrower contacts the creditor for this purpose.

This does not say anything about only for mail or internet transactions. So I am thinking it would work for all methods.
Posted By: BrendaW

Re: MLA Oral Disclosures -- Read to all borrowers? - 08/03/16 07:56 PM

I see what I did.....I didn't scroll down on the BOL site to the "red" section which is the changes to the rule.....I now see what you are referring to.. it has been a long day already!
Posted By: Tarhe

Re: MLA Oral Disclosures -- Read to all borrowers? - 08/15/16 07:19 PM

Just to confirm, if the co-applicant on a covered loan is NOT a covered borrower him/herself, then the oral disclosures do not need to be read to that person? No harm in doing so, I suppose? (For example, they are sitting together right in front of you.) But we wouldn't need to make a special call to the non-covered co-applicant to read the disclosures, right?
Posted By: Carter'sMom

Re: MLA Oral Disclosures -- Read to all borrowers? - 08/15/16 07:54 PM

Along the same lines - we are considering putting the required disclosure on our IVR 800 line for bank information. I don't see any guidance on how high up in the menu the oral disclosure would have to be. Thoughts?
Posted By: CULady

Re: MLA Oral Disclosures -- Read to all borrowers? - 08/15/16 08:26 PM

Tarhe- I believe that is correct, I don't see anything that suggests otherwise.

Carter'sMom - The MLA statement is only one piece of the puzzle. Don't forget you'll need to also be able to give the payments schedule orally as well. There is no guidance on where it would need to be in the menu, but I would suggest within the top 5 or so. You don't want examiners to think you are hiding it by burying it so far in the menu that no one will wait to get to it. We have our normal 1-800 with a dedicated extension that will read the MLA statement and then direct them to press 1 to reach someone to finish the disclosures by giving the payment schedule for that particular loan.
Posted By: Tracey, CRCM

Re: MLA Oral Disclosures -- Read to all borrowers? - 08/16/16 02:12 PM

Tarhe- do you mean the co-applicant is not a dependent of the service member at the time of the loan?
Posted By: Tarhe

Re: MLA Oral Disclosures -- Read to all borrowers? - 08/16/16 03:56 PM

Yes - the co-applicant is not a servicemember or covered dependent.