DOD Amends MLA Interpretive Rule

The Department of Defense has released changes to its 2016 interpretive rule clarifying certain provisions of the Military Lending Act regulation. The amendments address a number of concerns ABA raised in previous comments to DOD.

Among the amendments is a clarification that the exemption for purchase money loans includes loans that are used not only to purchase the item securing the loan but also to purchase related items, such as extended warranties on a car. They also offer clarifications about loans secured by a deposit account, the use of remotely created checks to make loan payments, the ability of lenders to use the right of offset and the timing of checking military status to qualify for the MLA safe harbor.

While the amendments addressed many of ABA’s concerns, they did not address all.  Still at issue are provisions related to oral disclosures; calculation of the Military Annual Percentage Rate for open-end loans; coverage of lot loans; and whether securities are personal property and subject to the exemption for purchase money loans secured by personal property. ABA will continue working with DOD to pursue further changes to the MLA regulations.

The association has published an initial members-only staff analysis of the amendments. Bankers can also find additional MLA compliance resources on a dedicated resource page on


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