Bankruptcy. The arrival of that notice stating a customer has filed for bankruptcy can evoke less-than-ideal responses: forwarding the notice to someone else who might know what to do with it (resulting in the notice ending up in a forever loop of being forwarded along); immediately writing off the account and cutting your losses; or,
CFPB Approves Synchrony’s “Dual-Feature Credit Card”
On December 30, 2020, the CFPB approved Synchrony Bank’s application to offer a “dual-feature credit card” (DFCC) under the CFPB’s Compliance Assistance Sandbox (CAS) policy. According to Synchrony’s application, the DFCC allows consumers to graduate from a secured-use credit card to an unsecured feature after at least one year and if the customer satisfies
State Attorneys General Challenge FDIC’s Madden Fix
In early August 2020, several state attorneys general filed suit against the Office of the Comptroller of the Currency (OCC) challenging the OCC’s proposed “Madden Fix.” Notably, while the Federal Deposit Insurance Corporation (FDIC) also issued their own Madden Fix, the agency was not named as a defendant in the initial lawsuit. As such,
New FAQ Responses to Small Dollar Rule Address Auto and Mortgage Lending, Payment Transfers and Notices Inclusion
On Tuesday, August 11, 2020, the CFPB issued a second round of answers to frequently asked questions related to the Small Dollar Rule. The FAQ responses range from addressing more nuanced provisions of the payment provision portion of the rule to the overall coverage of the rule.
Covered Loan Coverage
For the most part, auto
State Attorneys General Challenge OCC Madden Fix
Last Wednesday, the attorneys general of Illinois, California, and New York filed a lawsuit in the United States District Court for the Northern District of California challenging the Office of the Comptroller of the Currency’s proposed “Madden Fix.” This proposed rule, which we have discussed in detail, is designed to resolve some of the
Small Dollar Rule Stay Requested to Be Lifted in Recent Joint Status Report
With the Supreme Court’s recent decision in Seila Law and Director Kathleen Kraninger’s ratification of the payment provisions of the Payday, Vehicle Title, and Certain High-Cost Installment Loans Rule (the “Small Dollar Rule”), the CFSA and the CFPB have submitted a joint status report in the stayed case pending in the Western District of Texas.
OCC, FDIC Issue Long-Awaited Valid-When-Made “Madden Fix”
Recently, the Office of the Comptroller of the Currency (OCC) and the Federal Deposit Insurance Corporation (FDIC) issued final rules designed to resolve the uncertainty created by the Second Circuit Court of Appeals’ decision in Madden v. Midland Funding, 786 F.3d 246 (2d Cir. 2015). In Madden, the court called into doubt
CFPB Rescinds Small Dollar Rule Ability to Repay Provisions However Payment Provisions Remain
On July 7, 2020, the Consumer Financial Protection Bureau (CFPB) issued its final rule in regard to so-called small dollar loans. The biggest change from the CFPB’s original iteration of the rule, the 2017 Payday, Vehicle Title, and Certain High-Cost Installment Loans Rule (“small dollar rule”) is the Bureau’s decision to rescind the ability to
Joint Statement Issued by Federal Banking Regulators to Encourage (Yes, Encourage) Responsible Small-Dollar Lending in Response to COVID-19
Following previous guidance issued by (and in some cases withdrawn by) the OCC, CFPB, Federal Reserve, FDIC, and NCUA, the federal financial institution regulatory agencies published a joint statement on March 26, 2020, in response to COVID-19 “to specifically encourage financial institutions to offer responsible small-dollar loans to both consumers and small businesses.” The statement
Pre-Bankruptcy Automatic Stay Waivers – More Valuable Than Ever These Days?
In the very unusual period in which we find ourselves today, it seems to be common wisdom that an avalanche of commercial loan defaults is coming. As such, it is a good time to take a fresh look at the terms and provisions used in commercial workout documents, whether in a simple agreement that extends