Last week, the Department of Defense (DOD) issued a final rule modifying regulations set forth in the Military Lending Act (MLA). Passed by Congress in 2006, the MLA was created to protect active duty service members and their families from elevated interest rates in credit transactions, limiting the Military Annual Percentage Rate (MAPR) to 36 percent. The rule provides additional protections to military members from numerous credit products that the existing regulations do not address.
FDIC-supervised institutions and other creditors must abide by the newly-amended regulations beginning October 3, 2016, and compliance regarding credit for a new credit card in open-end consumer credit plans must begin October 3, 2017.
These changes to the MLA are important, beneficial developments for American servicewomen and men. The new rule will help protect those who protect this country day in and day out.
To read more about the final DOD rule, or view its regulations in full, please click here.