Two years ago, Congress passed the Military Lending Act, which included a number of provisions effectively banning payday loans to American Service Members.
So how has the law faired?
It looks like it is working. Even the Consumer Federation of America (a vocal detractor of payday loans) agrees that the Military Lending Act is working. They claim that "Early signs are encouraging" (and that lenders appear to be complying with the Act).
However, the CFA still wants more prohibitions against Military Lending. Here's what they suggest:
The Military Lending Act prohibits loans based on personal checks held for future deposit or on electronic access to borrower's bank accounts. The Department should remove any limiting factors in definitions of payday loans in order to extend that protection to all lending on terms that violate the MLA.
We'd love to hear from Servicemembers — what do you think about the MLA? Has it had a big effect (positive or negative) on your ability to manage your finances?
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