Trade Groups Submit Clarifications For DoD Rule On Military Lending

WASHINGTON—NAFCU and CUNA, along with several other trade associations, have submitted clarifications and modifications to the Department of Defense regarding its regulation implementing the Military Lending Act, including another request that the effective date for credit card compliance be extended one year to Oct. 3, 2018.
The trades wrote in a joint letter that the MLA rule's extension to cover credit card accounts "has resulted in a set of requirements that are unworkable for the industry and will restrict issuers’ ability to make this essential product fully available to servicemembers and their families." They encouraged the DoD to extend the compliance date one year without any further rulemaking. "The Department should do so immediately to give itself and the industry time to find a more workable solution," the trades suggested, according to a NAFCU report.
The trades also urged the DoD to issue an interim final rule amending the overall MLA regulation with a concurrent comment period to ensure that there is no disruption in access to credit for servicemembers and their families.
"Only a rule revising the MLA Regulation can bring the clarity and certainty required by consumers, industry, regulators, and courts," the trades wrote. They explained that another interpretive rule, though it may be helpful, "cannot provide this certainty and cannot address issues that require a change to the regulation itself." 
The rest of the letter provided details on the changes sought by the trades that would better clarify the rule, including the coverage of certain types of loans and determination of covered borrowers, NAFCU noted.
Along with NAFCU and CUNA, the letter was signed by the American Bankers Association, the American Financial Service Association, the Association of Military Banks of America, the Consumer Bankers Association, CUNA and the Independent Community Bankers of America.