“Let every nation know, whether it wishes us well or ill, that we shall pay any price, bear any burden, meet any hardship, support any friend, oppose any foe, to assure the survival and success of liberty.” The words of John Fitzgerald Kennedy ring out that those in service will bear any burden to protect the citizens of the United States, but now is the time to protect our service members. Congress proposed and passed the Military Lending Act (MLA) in 2006 and it offers a plethora of protections to service members and their dependents including capping interest rates, barring mandatory arbitration, and barring prepayment penalties.
A service member, as defined by the statute, is any active duty military personnel or any active guard members and reserve duty personnel. In addition, the MLA applies to dependents of those service members who are covered by the MLA, such as a spouse, an unmarried widow or widower, or a child who is either younger than 21 or younger than 23 if they are enrolled in college.
Interest rates under the MLA are capped at an annual percentage rate (APR) of 36 percent. However, there are many industries that charge well over 36 percent. For example: payday lenders, auto title lenders, credit card companies, and tax refund anticipation loans. The MLA only exempts certain residential mortgages and certain purchase-money loans.
Military members and their family are commonly targeted by scrupulous companies and charged well over the 36 percent APR cap, in violation of the MLA. An MLA violation entitles a service member to numerous types of remedies and relief. For a violation of the MLA, a Plaintiff can receive money damages, punitive damages, and even the cost of the action if successful. Furthermore, the loan agreement itself can be voided if it violates the MLA.
Lawyers at Beasley Allen are vigorously investigating violations of the MLA perpetrated against members of our armed forces. Anyone who has a high-interest loan and has a question about whether the loan violates the MLA should speak with a lawyer. Lawyers in our firm’s Consumer Fraud Section are well versed in the statutory violation and the protection offered to consumers when a violation occurs under the MLA. If you would like to learn more about a potential case or need guidance regarding the Military Lending Act contact one on these lawyers: Andrew Brashier at Andrew.Brashier@beasleyallen.com; Archie Grubb at Archie.Grubb@beasleyallen.com; Lance Gould at Lance.Gould@beasleyallen.com; or Larry Golston at Larry.Golston@beasleyallen.com or at 800-898-2034 or 334-269-2443. All consultations are free and confidential.
Sources: U.S.C.A. s987(i)(1), 1072, 987(b), 232.3(f)(2), 987(f)(5), 987(f)(3)
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