Military Lending Act Covered Borrower Database Access

If the credit union wishes to use the DMDC (Defense Manpower Data Center) direct connection capability (under development) to identify borrowers covered under the MLA (Military Lending Act) should email a request to the DMDC at dodhra.dodc-mb.dmdc.mbx.mla@mail.mil, by February 1.

The MLA places certain protections over covered borrowers, including a cap on annual percentage rates, so credit unions need to know which borrowers are covered. We previously blogged about the MLA here, and here.

Credit unions can use the existing method–using a covered borrower identification statement on the loan application–as a safe harbor for compliance until Oct. 3.

After Oct. 3, credit unions can determine whether a borrower is covered by the MLA by using one of two new safe harbor methods provided in the final rule. The credit union will be able to certify a borrower’s status on the DMDC database, or use a consumer report obtained from a nationwide consumer reporting agency.

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