The CFPB recently issued a statement that it will be reconsidering the final rule entitled “Payday, Vehicle Title, and Certain High-Cost Installment Loans” (the “Payday Lending Rule”), which became effective on January 16, 2018 (although most provisions of the Rule do not require compliance until August 19, 2019). The Payday Lending Rule, which was finalized in October 2017, was one of the last actions taken by former CFPB Director Richard Cordray.
The Payday Lending Rule was controversial because, among other requirements, it (1) mandated that payday lenders determine whether borrowers can afford the loans they take out, and (2) was expected to reduce lending volume. The CFPB’s plan to reopen rule-making under Acting Director Mulvaney could mean revising important provisions of the Rule.
Due to the anticipated rulemaking, the CFPB has stated that it will entertain requests from any potential applicant who wishes to waive the Payday Lending Rule’s existing April 16, 2018, deadline to submit an application for preliminary approval to become a registered information system.
The CFPB Statement on the Payday Lending Rule is available here.