NCUA Compliance Deadline: Payday, Vehicle Title, and Certain High-Cost Installment Loans
The final rule requires lenders to reasonably assess a consumer’s reasonable ability-to-repay (ATR) two types of consumer loan products: “short-term loans” and “longer-term balloon-payment loans.”
A higher rate, longer-term product is also a covered loan, but the lender is only required to comply with payment withdrawal restrictions and disclosure and record retention requirements. The rule did not incorporate the proposed requirements that would have infringed upon NCUA’s PAL program. Federal credit unions’ statutory right of offset to collect against an outstanding balance on a covered loan is explicitly permitted in the final rule. Certain loan products, such as purchase money security interests in vehicles, home mortgages, credit cards, student debt, and overdraft services are excluded from coverage. It also exempts “accommodation loans,” so long as the lender does not originate more than 2,500 covered loans in a calendar year or did not derive more than 10 percent of its receipts from covered loans.
Final Regulation –17-EF-10
Compliance Blog – 10/23/17
Download the latest full Compliance Calendar, including proposed regulations, past deadlines and more.