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Effective Date of MLA: "Check" DOD Database

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Question: 
Our bank has several home improvement applications that have been approved prior to 10-3-16 but they have not funded yet because we do not ​disburse the funds until all the improvements are completed. In cases like these, must we run an "MLA check" against the DOD database?
Answer: 

The key is not when the loan funds. It is when the customer becomes obligated on the note. If the loan was consummated (not necessarily funded) prior to 10/3/16, then no MLA check was needed. But if the loan will consummate on or after 10/3 then an MLA check needs to be performed. But you can't do it retroactively, so if you had some that consummated between 10/3 and today and you didn't do the check, there is not a way to fix that.

First published on 03/12/2017

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