SCRA (Servicemembers Civil Relief Act) and MLA (Military Leave Act)

Which of the following is not considered consumer credit under MLA? Residential mortgage Credit card loan Payday loan Unsecured consumer loan

Residential Mortgage

What is the limit on interest rates (including fees and charges) on obligations entered into BEFORE active duty during the entire period of military service?

6%

Which of the following is NOT a required disclosure for an income tax refund anticipation loan to a servicemember? MAPR APR A description of each of the events of default A list of all the fees included in the MAPR

A description of each of the events of default

What is a covered borrower check under the MLA?

A lender is required to perform a covered borrower check at the time of application to determine if the consumer is a covered member entitled to MLA protections

What is the scope of SCRA?

Covers loan obligations, lease agreements, lawsuits & insurance contracts for active duty in the federal military service

How long is foreclosure protection?

Extended for 12 months after the END of active duty

What is the major requirement of the MLA in terms of interest rate cap?

Imposes a 36% interest rate cap on consumer purpose credit transactions

Whose responsibility is it to notify the lender for MLA coverage and what is required

Lender must have in place a method to determine if a customer is a servicemember or not and deliver special MLA disclosures and the MAPR calculation

What is the upfront disclosure required under the MLA?

Military Annual Percentage Rate (MAPR) that is calculated using an expanded list of fees and charges

Under SCRA are spouses and dependents provided interest rate relief?

No, unless they are joint on the obligation

What is excluded under the 36% interest rate cap?

Residential mortgages and purchase money transactions for personal property (i.e. auto loans for purchase) and business purpose loans

Whose responsibility is it to notify the lender under SCRA and what is required?

Servicemember must self identify and provide in writing a request to receive rate reduction including a copy of his orders.

What is a dependent under SCRA?

Spouse, child and any individual dependent for which the servicemember provided at least 1/2 of their support during 180 days preceding the request for relief (e.g. parent of servicemember)

Is the description of the payment obligation required under MLA?

Yes

Is there safe harbor if a covered borrower check is performed against the Dept of Defense or nationwide consumer reporting agency?

Yes, if they can provide evidence

What is included in the MAPR?

a complete list of fees and charges included in the special MAPR calculation

Protections under SCRA

a court order is required for mortgage foreclosures, evictions and repossession, termination of certain contracts or leases for purchase of real or personal property including vehicles for a breach of terms w/out a court order, entitled to terminate certain motor vehicle leases for personal or business use as well as residential, professional, business, agriculture or similar purposes to certain conditions

What is the coverage for MLA?

covered members already on active duty in the federal military service