NorthLegal Webinar, Tuesday, November 20, 2018
What is your financial institution doing about your Military Lending Act auto lending problem?
Almost a year ago the federal Department of Defense issued an interpretive rule that said tens of thousands of auto financing loans previously thought to be exempt had to comply with the MLA. That ruling left financial institutions around the country (very possibly including yours) holding tens of thousands of direct and indirect loans that are–according to the DoD–now void.
Since then, we’ve heard talk of imminent changes to the law or to that interpretive rule, but those changes have not occurred and there is no indication they will occur soon. Meanwhile, the problem isn’t going away. It has been addressed during supervisory examinations and reportedly has been discussed at high level meetings on at least one military base.
Financial institutions holding affected loans have to decide what to do with them. There is no such thing as taking “no action;” each time you send a collection letter (or even a periodic statement) your financial institution is taking action. If the DoD interpretation stands, those actions may violate multiple state and federal laws and result in serious class litigation.
There are no good solutions, but careful planning may help financial institutions manage the risk and minimize losses.
During this program, participating financial institutions will learn:
- Exactly what the MLA, the regulations, and the DoD interpretation say about which auto and other purchase financing transactions are governed by the MLA.
- How to identify which of your direct and indirect loans are affected.
- The options you have for dealing with the problem and the advantages, disadvantages and legal justifications of each.
- The errors your financial institution may make when discussing the issue with consumers and with dealers that could make the problem worse.
Participants will also receive sample correspondence, including:
- Correspondence to consumers to determine who is a covered borrower.
- Correspondence to consumers to explain the problem and offer options.
- Correspondence to dealers to explain the problem and state what your financial institution intends to do.
For more information, or to register, visit http://northlegal.com/nl-webinars/2018/18-1120-MLAUpdate.php
NorthLegal Training and Publications, 5115 N. Dysart Rd, No. 202-500, Litchfield Park, AZ 85340
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