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Part 1041 - Payday, Vehicle Title, and Certain High-Cost Installment Loans

Reg Letter: 
OO
Issuing Agency: 
Reg info: 
Authority: 12 U.S.C. 5511, 5512, 5514(b), 5531(b), (c), and (d), 5532. Source: 82 FR 54871, Nov. 17, 2017, unless otherwise noted.

"The Payday Lending Rule became effective on January 16, 2018. However,the Rule’s general compliance date is August 19, 2019. Thus, by its terms, the Rule does not require lenders to comply with the Rule’s payment provisions or the related compliance program and record retention requirements until August 19, 2019. The compliance date, however, is currently stayed pursuant to a court order issued in Community Financial Services Association v. CFPB, No. 1:18-cv-00295 (W.D. Tex. Nov. 6, 2018). As a result, lenders have no obligation to comply with the Rule until the court-ordered stay is lifted." (Small entity compliance guide for the rule)

The CFPB has rescinded the mandatory underwriting provisions of the rule effective October 20, 2020, and ratified the remaining provisions. These changes have been posted in our Regulations pages.

The CFPB has not yet petitioned the U.S. District Court for the Western District of Texas to lift its stay and allow the remaining requirements to go into effect with a reasonable period for getting into compliance. The plaintiffs in the case have submitted a brief arguing that the Bureau was unconstitutional when the rule was issued, and that the Supreme Court's "fix" for that flaw (making the Director subject to dismissal by the president at will) does not make the subsequent ratification of the rule valid. Plaintiffs argue the CFPB must restart the process with a new proposed rule.

The CFPB has released an updated Small Entity Compliance Guide for the payment provisions of the rule, and FAQs.

For a table of Federal Register documents affecting this regulation, click HERE

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