CFPB Issues Payday Lending Rule

On October 5, the Consumer Financial Protection Bureau (CFPB) issued a final rule on payday, vehicle title, and high-cost installment loans. The final rule and related information came in at a whopping 1,690 pages. The final rule establishes that it is an unfair and abusive practice for a lender to make payday and vehicle title loans without reasonably determining that the consumer has the ability to repay the loan according to the loan terms. The final rule also makes it unfair and abusive for a lender to attempt to withdraw payment from a consumer’s account after two consecutive payment attempts have failed, unless the consumer specifically provides new authorization to do so.

https://s3.amazonaws.com/files.consumerfinance.gov/f/documents/201710_cfpb_final-rule_payday-loans-rule.pdf

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John Zasada is a principal with CLA and leads the firm’s financial institution regulatory compliance practice. He assists banks and credit unions nationwide in establishing regulatory compliance programs, conducting compliance testing, training staff on regulations, and performing website compliance assessments. In addition, John is a frequent speaker at industry conferences and state associations. Prior to joining CLA, he served as managing director at a top-10 accounting firm and as the compliance officer of a large financial institution, where he developed and implemented its first regulatory compliance program.

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