Special Alert: CFPB Releases Outline of Proposed Rule for Payday, Vehicle Title, and Similar Loans
Buckley Special AlertJohn P. Kromer, Marshall T. Bell
On March 26, the CFPB announced that it is considering proposing a rule to “end payday debt traps” and released several related documents, including a fact sheet and an outline of the proposal that will be presented to a panel of small businesses pursuant to the Small Business Regulatory Enforcement Fairness Act (SBREFA). The proposal sets forth ability to repay requirements for “short-term” and “longer-term” loans, and then provides alternative options for lenders to provide both types of loans in lieu of complying with the general ability to repay requirements.
Under the SBREFA process, the CFPB first seeks input from a panel of small businesses that likely will be subject to the forthcoming rule. A report regarding the input of those reviewers is then created and considered by the CFPB before issuing its proposed rule.
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Questions regarding the matters discussed in this Alert may be directed to any other Buckley Sandler attorney with whom you have consulted in the past.