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MLA Population/Universe Determination

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  • #31710
    mlcanady
    Participant

    How are other’s sampling MLA covered loans for review, if the first line isn’t monitoring for MLA loans?

    #31763
    rcooper
    Keymaster

    I believe most banks are coding these loans in order to track them in their systems – that is something that needs to be done. Without that it is going to be difficult for you to have an accurate list for review. You might take various approaches to identify them… 1) poll loan staff, 2) work with your LOS and loan ops to indenfitfy loans where a MLA disclosure was provided/MAPR was calculated, 3) look at interest rate reports to identify loans with lower rates which might indicate a covered MLA loan. Talk with loan ops and see what other options you might have to identify these loans. It will likely be piecing the list together.

    I’ve sent this to a couple of auditors – hopefully they can tell what they’re seeing in banks and might have some additional ideas to help you.

    #31767
    Evelyn
    Participant

    First, it should be an attribute on your post-closing loan checklist to assure that it’s obtained when required. This assures individual loan compliance.

    As an auditor, we only look for MLA compliance when auditing consumer loans (doesn’t apply to mortgages). We sample all types of consumer loans/lines (vehicle, deposit secured, unsecured, other secured, etc.) and look for MLA compliance as one of our checklist attributes. It can be hit or miss (as was the case with vehicle secured loans). So far, we’ve not heard any concerns with this methodology.

    #31782
    rcooper
    Keymaster

    Ann Marie from Bankers Service Corportation asked us to post the following:

    “Most banks we have been in have loan officers or processors verifying the borrower’s status on consumer loans using one of the safe harbors for MLA, and more often than not, they are checking it whether the transaction is subject to MLA or not. The original poster contact us if he or she would like to discuss further.”

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