The Department of Defense’s (DoD) July 2015 amendments to the Military Lending Act (MLA) took effect one week ago, and CUNA responded with a method to assist CUs navigating the complex process. The DoD’s Military Lending Act rule prohibits a credit union from imposing a MAPR greater than 36 percent in connection with a loan made to a covered borrower.
For those credit unions that will not have access to MAPR calculators for a period of time after the effective date, CUNA has partnered with KJE Computer Solutions, LLC, to create two MAPR loan calculators — one for closed-end loans and one for open-end loans — that are subject to MLA regulations.
These calculators will help credit unions make a manual determination of the MAPR and will indicate when a combination of interest, fees and charges exceed 36 percent. To improve ease of access, the calculators will be maintained on CUNA’s website as outlined below:
- Under the Resources tab for the Military Lending Act topic in CUNA’s eGuide – click here
- In the Resources listing from the Compliance dropdown box on CUNA’s Home page – click here
- In CUNA’s Compliance Community under, in the Compliance Resources dropdown box – click here
These calculators must be maintained on CUNA’s website and may not be downloaded for use on any other website without permission of CUNA or permission of KJE Computer Solutions, LLC.
For closed-end loans, the MAPR is calculated only one time — at or before loan consummation. For open-end loans, the MAPR is calculated during each billing cycle. If the MAPR exceeds 36 percent, a CU would be expected to waive a sufficient amount of interest, fees, premiums, or charges to reduce the MAPR. Read more about MAPR at InfoSight.
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