Removing Barriers Blog

Advocacy Efforts with DoD Result in Forthcoming MLA Guidance
Posted June 23, 2016 by CUNA Advocacy

This week, we participated in a meeting with the Department of Defense to discuss ongoing concerns with the Military Lending Act (MLA) rule, which is scheduled to go into effect this October. 

This was our third meeting this year with DoD where we pushed for guidance to help credit unions comply with the rule. As a result of pressure from the entire financial services industry, DoD announced at today’s meeting that it is indeed in the process of finalizing guidance on its MLA rule. In a letter to DoD last month, we urged DoD to publish its guidance no later than the end of June. While DoD did not indicate when the interpretive rule will be released, we anticipate it will be within the next couple of weeks. 

The NCUA issued a Regulatory Alert earlier this year that provides a useful, complete summary of the MLA rule. However, we feel that guidance from DoD is still necessary since NCUA has indicated that it must defer to DoD on interpreting the MLA rule. 

We remain optimistic that the forthcoming guidance from DoD will help to answer some of the many questions credit unions have been asking. Earlier this year, DoD asked us to provide proposed guidance language. The language we provided directly addresses many of the issues we’ve been hearing, so we are hopeful the guidance incorporates our recommendations. 

In addition to compliance guidance, we raised several other concerns during the meeting, including about limited direct access to the Defense Manpower Data Center (DMDC) database, which lenders must use to verify covered borrower status under the rule.