Compliance Bulletin

Department of Defense Database Eases Military Lending Act Compliance
March 7, 2016

With the expansion of the Military Lending Act (MLA) to cover most Regulation Z consumer loans (except for residential and automobile loans), traditional banks welcome the new database made available by the Department of Defense to help them determine the status of loan applicants who are active service members or their spouses and dependents. Still, MLA compliance is expected to be challenging. The MLA regulation features a “military APR” cap of 36% that incorporates fees not included in the Regulation Z APR, new disclosures, and a host of nebulous restrictions. See CBA’s Regulatory Compliance Bulletin for more information.