ALEXANDRIA, Va.—NCUA’s new rules allowing for PAL II loans will go into effect on Nov. 29.
As CUToday.info reported here, http://www.cutoday.info/Fresh-Today/NCUA-Approves-PALs-II-Rules
the NCUA board voted 2-1 at its most recent meeting to approve final new rules for Final Rule, Part 701, Payday Alternative Loans II (PALs II). The new rules create an additional PAL option and do not replace the current PALs I loans.
PAL II loans are now permitted to be made by credit unions in amounts up to $2,000, with no minimum loan amount and a maximum term of 12 months. That’s a change from the PALs I loans that are restricted to amounts between $200 and $1,000 and a six-month term.
PAL II loans would not have the 30-day membership requirement, an issue for which both CU trade groups had advocated. The new rule includes a few changes from what had originally been proposed.
NCUA published a notice in the Federal Register stating the PAL II rules will take effect Nov. 29.