military lending actbeing purchased. a hybrid purchase money and cash advance loan is not expressly...

Spencer Fane LLP | spencerfane.com

Military Lending Act: Exam Procedure Changes,

Post-Implementation Considerations & FAQs

M. Elizabeth Fast, Esq.

Spencer Fane LLP

Phone: (800) 526-6529 toll free

Fax: (816) 474-3216

[email protected]

February 2017


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Today’s Presenter

Elizabeth Fast, JD, CPA

Spencer Fane LLP

Elizabeth Fast is a partner with Spencer Fane LLP where she

specializes in the representation of financial institutions. Elizabeth is

the head of the firm’s training division. She received her law degree

from the University of Kansas and her undergraduate degree from

Pittsburg State University. In addition, she has a Master of Business

Administration degree and she is a Certified Public Accountant. Before

joining Spencer Fane, she was General Counsel, Senior Vice

President, and Corporate Secretary of a $9 billion bank with more than

130 branches, where she managed all legal, regulatory, and

compliance functions. She is a member of the Missouri State Banking

Board by appointment of the Governor.

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Spencer Fane LLP | spencerfane.com 5

Background

• Military Lending Act (MLA) originally became

effective on 10-01-07

• Purpose: Impose limitations on the cost and

terms of certain extensions of consumer credit to

servicemembers and their dependents, and to

require additional consumer disclosures to them

• MLA grants authority to the Department of

Defense to adopt regulations – 32 C.F.R. §232


Background (cont.)

• Previously, MLA only applied to non-traditional

loans (i.e., payday loans, title loans, and tax

refund anticipation loans)

• Most banks and credit unions don’t extend those

types of non-traditional loans, so they previously

weren’t subject to MLA

• Recent regulations make MLA applicable to more

traditional loans and credit cards, so your

institution is now subject to MLA


Implementation Dates of New Regulations

• Compliance date for new regulations was 10-3-16

(credit cards is 10-3-17)

• Old regulations continue to apply to credit

extended before 10-3-16

• New regulations only apply to credit extended

after 10-3-16


Summary of New Regulations

• Continues 36% maximum interest rate

• Extends protection of MLA to broader range of

closed-end and open-end loans

• Modifies mechanism creditor can use when

assessing whether person is a “covered borrower”

• Modifies disclosures that creditor must provide


Important Definitions

• New regulation applies to “consumer credit”

extended to a “covered borrower”

– Consumer Credit

– Covered Borrower


Definition of Consumer Credit

• New regulation revises definition of consumer

credit to be more consistent with Regulation Z.

New regulation defines consumer credit as credit

extended to a covered borrower primarily for

personal, family, or household purposes that is:

(1) subject to a finance charge, or (2) payable by

written agreement in more than four installments

– Previously, MLA only applied to payday loans,

vehicle title loans, and tax refund anticipation loans


Consumer Credit (cont.)

• Consumer credit does NOT include:

– Credit secured by residential mortgage (includes purchase,

construction, refinance, HELOC, and reverse mortgage)

• Example: Consumer submits a loan application to purchase a

new home. Does MLA apply? NO

• Example: Consumer submits a HELOC application for his

existing home. Does MLA apply? NO

– Credit intended to finance purchase of a motor vehicle when

credit is secured by that vehicle

• Example: Consumer submits a loan application to purchase a

new or used car and loan will be secured by car purchased.

Does MLA apply? NO

• Example: Consumer submits a loan application and he will

pledge his existing car that he purchased back in 2015.

Does MLA apply? YES




– Credit intended to finance purchase of personal property

when credit is secured by that personal property

• Example: Consumer submits a loan application for

unsecured credit that he will use to purchase a new

computer. Does MLA apply? YES

• Example: Consumer submits a loan application to

purchase a new computer and loan will be secured by

new computer. Does MLA apply? NO

• Example: Consumer submits a loan application to

purchase a new computer. The loan will be secured by the

new computer, but the loan proceeds exceed the purchase

price of the computer so loan provides “additional

proceeds” to the consumer. Does MLA apply? YES



Does credit that a creditor extends for the purpose of purchasing personal

property, which secures the credit, fall within the exception to “consumer

credit” under 32 CFR 232.3(f)(2)(iii) where the creditor simultaneously

extends credit in an amount greater than the purchase price?

Answer: No. Section 232.3(f)(1) defines “consumer credit” as credit extended to

a covered borrower primarily for personal, family, or household purposes that is

subject to a finance charge or payable by written agreement in more than four

installments. Section 232.3(f)(2) provides a list of exceptions to paragraph (f)(1),

including an exception for any credit transaction that is expressly intended to

finance the purchase of personal property when the credit is secured by the property

being purchased. A hybrid purchase money and cash advance loan is not expressly

intended to finance the purchase of personal property, because the loan provides

additional financing that is unrelated to the purchase. To qualify for the purchase

money exception from the definition of consumer credit, a loan must finance only

the acquisition of personal property. Any credit transaction that provides purchase

money secured financing of personal property along with additional “cash-out”

financing is not eligible for the exception under § 232.3(f)(2)(iii) and must comply

with the provisions set forth in the MLA regulation.

https://www.federalregister.gov/select-citation/2016/08/26/32-CFR-232.3




– Credit that is an exempt transaction under

Regulation Z (other than exemption under

§1026.29) or exempt from disclosure

requirements under Regulation Z

– Credit where creditor determines consumer is

not a “covered borrower” by using safe harbor

method


Definition of Covered Borrower

• New regulation expressly states that it does

not apply to credit extended to a consumer

who is not a covered borrower at the time

he/she becomes obligated on the credit, and

it does not apply to the credit when the

consumer no longer is a covered borrower


Covered Borrower (cont.)

• A member of the Army, Navy, Air Force, Marines,

or Coast Guard serving on active duty under call

or order that does not specify a period of 30 days

or less

• A member serving on Active Guard or Reserve

duty as that term is defined under 10 U.S.C.

101(d)(6) (full-time duty for period of 180

consecutive days or more)



• Dependent of member as described in 10 U.S.C.

1072(2)(A), (D), (E) & (I)

– Spouse

– Child under 21

– Child under 23 enrolled full-time in school and dependent for

over ½ support

– Child that became mentally or physically incapacitated before

age 21 (or age 23 while enrolled full-time in school) and

dependent for over ½ support

– Parent or parent-in-law who resides in household and dependent

for over ½ support

– Legal custody of unmarried person under same rules for child,

dependent for over ½ support, and resides with member unless

separated by military service or under institutional care



• Example: Consumer A is member of armed forces but

not serving on active duty. He establishes closed-end

credit account at FI. Thereafter, he is ordered to serve

on active duty, thereby becoming a covered borrower.

Then, he establishes an open-end line of credit at FI.

MLA applies to the open-end line of credit (entered into

after active duty), but not the closed-end credit (entered

into before active duty).

• Continuing Example: One year after establishing the

open-end line of credit, he ceases to serve on active

duty. MLA no longer applies to the open-end line of

credit because he is no longer a covered borrower

(after ceases active duty).


How to Determine if Person is

Covered Borrower

• Creditor permitted to apply its own method to

determine if person is covered borrower

• Old regulation safe harbor method:

– Person signed special statement (i.e., check the

box) to confirm that they were or were not a

covered borrower

– This old safe harbor method is no longer a safe

harbor method after October 2, 2016


How to Determine if Person is

Covered Borrower (cont.)• New regulation permits two safe harbor methods:

1. Verify status by checking the DOD’s Defense Manpower Data

Center; or

– https://mla.dmdc.osd.mil/

– Must have last name, date of birth, and SSN

2. Verify status by using indicator obtained from nationwide

consumer reporting agency or reseller of report

– Consumer reporting agencies are trying to get access to

DOD database

• Under safe harbor methods, must retain copy of DOD

database certificate or consumer report from no earlier than

30 days prior to date consumer initiates transaction

(60 days prior to when creditor made firm offer of credit)

https://mla.dmdc.osd.mil/


Interest Rate Limitation

• MLA restricts Military Annual Percentage Rate (MAPR) to 36% or less

• MAPR is not the same as APR calculated under Regulation Z –

MARR includes fees that APR does not include

• MAPR includes the following:

– Finance charges

– Application fee (exception for bank, savings association, and credit union

when making a short-term, small-amount loan if fee charged not more

than once in any 12-month period)

– Fees to participate in plan or arrangement for credit

– Credit insurance premiums, including charges for single premium credit

insurance, fees for debt cancellation or debt suspension agreements

– Fees for credit-related ancillary products sold in connection with the

credit transaction


Interest Rate Limitation (cont.)

• Is GAP insurance included in the MAPR calculation?

Probably yes, since the MAPR calculation includes

credit insurance premiums, fees for debt

cancellation, and credit-related ancillary products.

• Is an extended vehicle warranty policy included in

the MAPR calculation? DOD hasn’t issued a clear

interpretation as to whether warranty policies are

deemed part of the vehicle purchase price which

would not be included in the MAPR calculation or

deemed credit-related ancillary products which

would be included in the MAPR calculation.



Under 32 CFR 232.4(b), are creditors permitted to waive fees or periodic

charges at the end of a billing cycle or earlier for open-end credit, in order

to prevent a borrower from being assessed a military annual percentage

rate (MAPR) in excess of 36 percent during that billing cycle?

Answer: Yes. Section 232.4(b) requires that a creditor may not impose an

MAPR greater than 36 percent in connection with an extension of consumer

credit that is closed-end credit or in any billing cycle for open-end credit. In an

open-end credit account, a covered borrower's use of a line of credit might,

under certain circumstances, give rise to the imposition of a combination of

fees and/or periodic charges that would cause the MAPR to exceed the limit in

§ 232.4(b). A creditor can comply with § 232.4(b) by designing a combination of

periodic rates and fees that cannot possibly result in an MAPR greater than 36

percent. Nevertheless, nothing in 32 CFR part 232 prohibits a creditor from

complying by waiving fees or finance charges, either in whole or in part, in

order to reduce the MAPR to 36 percent or below in a given billing cycle. Thus,

a creditor could alternatively comply by not imposing charges in excess of 36

percent MAPR that would otherwise be permitted under the credit agreement.


https://www.federalregister.gov/select-citation/2016/08/26/32-CFR-232



• MAPR for credit cards excludes application fee,

participation fee, and transaction fee if the fee is:

1. Bona fide; and

– Credit insurance premiums, debt cancellation fees,

and ancillary credit products aren’t bona fide fees

for this purpose

2. Reasonable for that type of fee

– Compare to similar fees imposed by other creditors

– Safe harbor for reasonableness of fee is if it is less

than or equal to average fee charged during

preceding 3 years by 5 or more creditors having

U.S. cards of at least $3 billion


Interest Rate Limitation (cont.)Under 32 CFR 232.4(d), is it permissible to consider benefits provided by

credit card rewards programs in determining whether the amount of a fee is

(a) less than or equal to an average amount of a fee for a substantially similar

product or service for purposes of comparison under the safe harbor and

(b) reasonable overall?

Answer: Generally, yes. Section 232.4(d)(1) provides that for a credit card account

under an open-end (not home-secured) consumer credit plan, a bona fide fee, other

than a periodic rate, is not a charge required to be included in the MAPR, provided it

is a bona fide fee and reasonable for that type of fee. Under § 232.4(d)(3)(i), whether

a fee is reasonable is determined by comparison to fees typically imposed by other

creditors for the same or a substantially similar product or service. Under

§ 232.4(d)(3)(iii), whether a fee is reasonable depends on other factors relating to

the credit card account. Section 232.4(d)(3)(iv) further clarifies that whether a

participation fee is reasonable may be determined in reference to whether a credit

card offers additional services or other benefits. Moreover, the supplementary

information to the July 2015 Final Rule explains that “the `reasonable' condition for a

bona fide fee is intended to be applied flexibly so that, in general, creditors may

continue to offer a wide range of credit card products that carry reasonable costs

expressly tied to specific products or services and which vary depending upon the

covered borrower's own choices regarding the use of the card.”




Under the Department's flexibly applied conditional

exclusion, creditors may use any reasonable approach in

identifying whether a fee is substantially similar for

purposes of comparison and reasonable overall. Thus, the

Department's policy, in this regard, permits a creditor to

consider whether the benefits provided by a rewards

program in determining whether a fee is reasonable overall.

Moreover, creditors may consider rewards program

benefits in determining whether the amount of a fee is less

than or equal to an average amount of a fee for a

substantially similar product or service for purposes of the

safe harbor in § 232.4(d)(3)(ii).


Required Disclosures

• Before or at time covered borrower becomes

obligated on transaction, written disclosures

must be given to covered borrower containing:

– MAPR description applicable to the extension of credit

• Do not disclose actual numerical MAPR (because it will

conflict with APR under Reg Z), but must generally

describe charges used to calculate MAPR

• Use Model Disclosure Statement

– Any disclosures required by Reg Z

– Clear description of the payment obligation

• If payment obligation disclosed as part of the Reg Z

disclosure, then the Reg Z disclosure will suffice


Required Disclosures (cont.)

• Model disclosure statement: “Federal law provides

important protections to members of the Armed Forces

and their dependents relating to extensions of consumer

credit. In general, the cost of consumer credit to a

member of the Armed Forces and his or her dependent

may not exceed an annual percentage rate of 36

percent. This rate must include, as applicable to the

credit transaction or account: The costs associated with

credit insurance premiums; fees for ancillary products

sold in connection with the credit transaction; any

application fee charged (other than certain application

fees for specified credit transactions or accounts); and

any participation fee charged (other than certain

participation fees for a credit card account).”



• Disclosures must be given in writing and in a

form the borrower can keep

• In addition to written disclosures, creditor must

orally provide the disclosures:

– In person; or

– Creditor may provide a toll-free telephone number on

the loan application or along with the written

disclosures, so borrower can obtain disclosures orally

• Renewal or refinancing requires new disclosures

if it is deemed a new transaction under

Regulation Z



How may a creditor orally provide the payment obligation disclosure required

under 32 CFR 232.6(a)(3) to meet the requirements of 32 CFR 232.6(d)(2)?

Answer: Section 232.6(a)(3) requires a creditor to provide to a covered borrower,

before or at the time the borrower becomes obligated on the transaction or

establishes an account for the consumer credit, a clear description of the payment

obligation of the covered borrower, as applicable. A payment schedule (in the case

of closed-end credit) or an account-opening disclosure (in the case of open-end

credit) provided pursuant to the requirement to provide Regulation Z disclosures

satisfies this obligation. Therefore, a creditor may orally provide the information in a

payment schedule or an account-opening disclosure to a covered borrower.

However, an oral recitation of the payment schedule or the account-opening

disclosure is not the only way a creditor may comply with § 232.6(a)(3). A creditor

may also orally provide a clear description of the payment obligation of the covered

borrower by providing a general description of how the payment obligation is

calculated or a description of what the borrower's payment obligation would be

based on an estimate of the amount the borrower may borrow. For example, a

creditor could generally describe how minimum payments are calculated on open-

end credit plans issued by the creditor and then refer the covered borrower to thecontinued on next page





written materials the borrower will receive in connection with opening the plan.

Alternatively, a creditor could choose to generally describe borrowers' obligations

to make a monthly, bi-monthly, or weekly payment as the case may be under the

borrowers' agreements.

Neither the MLA nor the MLA regulation specifies particular content or format for

the requirement of a clear, oral description of the payment obligation. Also, nothing

in the MLA or the MLA regulation requires that the clear description of the payment

obligation provided in writing must be the same as the oral disclosure, provided

that both disclosures are clear and accurate. As explained in the supplementary

information to the Department's July 2015 Final Rule, the Department's approach

has been to interpret the MLA's oral disclosure requirement in a manner that

provides creditors “straightforward mechanisms” that afford “latitude to develop the

same (or consistent) systems to orally provide the required disclosures—

regardless of the particular context . . .” The requirement of a clear, oral payment

obligation disclosure has sufficient breadth that creditors may choose a variety of

acceptable oral disclosure compliance strategies. Thus, under the Department's

approach, a generic oral description of the payment obligation may be provided,

even though the disclosure is the same for borrowers with a variety of consumer

credit transactions or accounts.


Required Disclosures (cont.)If a creditor chooses to provide the information that is required to be

provided orally by providing a toll-free telephone number, consistent with

32 CFR 232.6(d)(2)(ii)(B), when must the information be available to the

borrower?

Answer: Section 232.6(d)(2) requires a statement of the MAPR and a clear description

of the covered borrower's payment obligation to be provided to the covered borrower

orally. Creditors may satisfy this requirement by providing the information to the covered

borrower in person or through a toll-free telephone number. If the creditor decides to

provide the borrower with a toll-free telephone number, the toll-free telephone number

must be provided on i) a form the creditor directs the consumer to use to apply for the

transaction or account, or ii) the written disclosure of the information that is required

under § 232.6(d)(1). Since § 232.6(d)(2) permits creditors to provide oral disclosures by

providing a toll-free telephone number, such information must be available from the time

the creditor provides the toll-free telephone number. The difficulty of providing this

information in a timely way through a toll-free telephone system is mitigated by the

Department's interpretation of mandatory oral disclosures as allowing for a nonnumeric

statement of the MAPR and a generic, clear description of the payment obligation.

See § 232.6(c) and Question and Answer #12 of these Interpretations. Oral disclosures

provided through a toll-free telephone system need only be available under

§ 232.6(d)(2)(ii)(B) for a duration of time reasonably necessary to allow a covered

borrower to contact the creditor for the purpose of listening to the disclosure.



Prohibited Actions

• Creditor (or its assignee) is prohibited from taking

the following action:

– Rolling over, renewing, refinancing or consolidating a loan

made previously by the same creditor, unless the new

transaction results in terms more favorable, such as a

lower MAPR (exception for bank, savings association,

and credit union)

– Requiring borrower to waive his/her rights

– Requiring borrower to submit to arbitration or other

onerous legal notice provisions (regulation expressly

states any agreement to arbitrate is not enforceable)

– Demanding unreasonable notice from borrower as a

condition for legal action


Prohibited Actions (cont.)

– Using a check or other method of access to a

deposit, savings or other financial account

maintained by borrower, except:

• The creditor may require an EFT to repay the loan,

unless otherwise prohibited by law

• The creditor may require direct deposit of borrower’s

salary, unless otherwise prohibited by law

• The creditor may, if not otherwise prohibited by law,

take a security interest in funds deposited in an

account established in connection with the extension

of credit



Does the limitation in § 232.8(e) on a creditor using a check or other method

of access to a deposit, savings, or other financial account maintained by the

covered borrower prohibit the borrower from repaying a credit transaction

by check or electronic fund transfer?

Answer: No. As a general proposition the prohibition of a creditor's use of a

check or other method of access in § 232.8(e) does not in any way imply that a

creditor cannot be paid. In no case does paragraph (e) prevent covered borrowers

from tendering a check or authorizing access to a deposit, savings, or other

financial account to repay a creditor. Section 232.8(e) also does not prohibit a

covered borrower from authorizing automatically recurring payments, provided

that such recurring payments comply with other laws, such as the Electronic Fund

Transfer Act and its implementing regulations, including 12 CFR 1005.10, as

applicable. In contrast, § 232.8(e) prohibits a creditor from using the borrower's

account information to create a remotely created check or remotely created

payment order in order to collect payments on consumer credit from a covered

borrower. Similarly, a creditor may not use a post-dated check provided at or

around the time credit is extended that deprives the borrower of control over

payment decisions, as is common in certain payday lending transactions.




Section 232.8(e)(1) and (2) further clarify that covered borrowers may

tender checks and authorize electronic fund transfers by specifying

permissible actions creditors may take to secure repayment by

covered borrowers. The exceptions address cases where a creditor

requires a covered borrower to provide repayment in a certain way.

Specifically, under § 232.8(e)(1), a creditor may require an electronic

fund transfer to repay a consumer credit transaction, unless otherwise

prohibited by law. The Department notes that 12 CFR 1005.10(e)(1)

prohibits anyone from conditioning an extension of credit to a

consumer on the consumer's repayment by preauthorized electronic

fund transfers (except for credit extended under an overdraft credit

plan or extended to maintain a specified minimum balance in the

consumer's account). However, a preauthorized electronic fund

transfer is defined under 12 CFR 1005.2(k) as an electronic fund

transfer authorized in advance to recur at substantially regular

intervals.





In addition, § 232.8(e)(2) clarifies that a creditor is permitted to require

direct deposit of the consumer's salary as a condition of eligibility for

consumer Start Printed Page 58845credit, unless otherwise prohibited

by law. While § 232.8(g) prohibits a creditor from requiring as a

condition for the extension of consumer credit that the covered

borrower establish an allotment to repay an obligation, the regulation

does not apply this restriction to a “military welfare society” or a

“service relief society” as defined in 37 U.S.C. 1007(h)(4).

https://api.fdsys.gov/link?collection=uscode&title=37&year=mostrecent&section=1007&type=usc&link-type=html



Does the limitation in § 232.8(e) on a creditor using a check or

other method of access to a deposit, savings, or other financial

account maintained by the covered borrower prohibit the

borrower from granting a security interest to a creditor in the

covered borrower's checking, savings or other financial account?

Answer: No. The prohibition in § 232.8(e) does not prohibit covered

borrowers from granting a security interest to a creditor in the covered

borrower's checking, savings, or other financial account, provided that

it is not otherwise prohibited by applicable law and the creditor

complies with the MLA regulation including the limitation on the MAPR

to 36 percent. As discussed in Question and Answer #16 of these

Interpretations, § 232.8(e) prohibits a creditor from using the

borrower's account information to create a remotely created check or

remotely created payment order in order to collect payments on

consumer credit from a covered borrower or using a post-dated check

provided at or around the time credit is extended.



Section 232.8(e)(3) further clarifies that covered borrowers may

convey security interests in checking, savings, or other financial

accounts by describing a permissible security interest granted by

covered borrowers. Thus, for example, a covered borrower may

grant a security interest in funds deposited in a checking,

savings, or other financial account after the extension of credit in

an account established in connection with the consumer credit

transaction.



– Using title of vehicle as security for extension

of credit (exception for banks, associations,

and credit unions)

– Requiring borrower to establish an allotment

to repay credit, as condition for the extension

of credit

– Prohibiting borrower to prepay credit, or

charging a penalty for prepaying all or part of

the credit


Penalties

• Creditor who knowingly violates the MLA shall

be guilty of a misdemeanor and may be fined or

imprisoned up to one year or both.

• Any contract which is in violation of the MLA

is void.

• Creditor liable for actual damages sustained

by consumer, but not less than $500 for

each violation.


Penalties (cont.)

• Other remedies are permitted, such as

consequential and punitive damages.

• If consumer is successful in action against

creditor, creditor liable for consumer’s court

costs and attorney fees.

• Conversely, if creditor is successful and if court

finds consumer brought action against creditor in

bad faith and for the purpose of harassment,

court can hold consumer liable for creditor’s

attorney fees.


Penalties (cont.)

• Creditor has defense to civil damages if

creditor shows by preponderance of evidence

that violation was not intentional and resulted

from bona fide error notwithstanding the

maintenance of procedures reasonably

adapted to avoid such error, but error of legal

judgment is not bona fide error


Coordination with Servicemembers

Civil Relief Act (SCRA)

• MLA states that nothing in MLA shall be

construed to limit or otherwise affect the

applicability of SCRA

• MLA applies to loans entered into after

servicemember on active duty

• SCRA applies to loans entered into before

servicemember on active duty


SCRA

• 1940 – Soldiers & Sailors Civil Relief Act (SSCRA)

• 2003 – Servicemembers Civil Relief Act (SCRA) –

replaces the SSCRA

• Purpose – Provide servicemembers with interest

rate relief and protection from creditor remedies

(i.e., foreclosure, garnishment, repo) during the

period of military service


SCRA Interest Rate

• SCRA requires lender to reduce interest rate

on any pre-service “obligation or liability” to 6%

during the period of military service

– If mortgage obligation, interest rate relief of 6%

is extended for one year after return from

military service

• Excess interest over 6% must be forgiven –

not just deferred


Must Be Before Active Service

• SCRA only applies to an obligation or liability

entered into before servicemember entered

active military service

• Open-end credit (i.e., credit card) – rate

reduction does not apply to new amounts

borrowed/charged after enter military service


Servicemember Responsibilities

• Servicemember must provide creditor with

written notice and a copy of his/her orders to

military service.

• Servicemember can request the rate reduction

up to 180 days after release from military

service. Rate reduction would then have to be

applied by creditor retroactively to the period of

military service.


Servicemember Responsibilities (cont.)

• Servicemember is not required to show that

his/her ability to pay is affected by military

service in order to obtain the rate reduction.

• But, the creditor can apply to the court for relief if

creditor believes the ability to pay the obligation

is not materially affected by the military service.

• Basically, the only way to not lower the rate to

6% is with court permission.


Limitations on

Repossession & Foreclosures

• An installment contract secured by real or personal

property cannot be terminated for breach of contract

[including nonpayment] without a court order whether the

breach occurred before or during the period of military

service.

• Property which is the subject of an installment contract

cannot be repossessed without a court order during the

person’s military service.

• Obligation secured by mortgage or deed of trust cannot be

foreclosed on during the period of military service plus one

year thereafter. (On 1-1-18, will revert back to 90 days.)


If you have any questions regarding this

presentation, you are welcome to contact:

M. Elizabeth Fast, Esq.

Spencer Fane, LLP

Phone: (800) 526-6529 toll free

Fax: (816) 474-3216

[email protected]

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