Posted by Steve Van Beek
Sec. 150. Consideration of Ability to Repay.
"A card issuer may not open any credit card account for any consumer under an open end consumer credit plan, or increase any credit limit applicable to such account, unless the card issuer considers the ability of the consumer to make the required payments under the terms of such account."
Section 109 does not require the Federal Reserve to issue regulations. However, it is likely the Fed will amend Regulation Z to provide further information and guidance to card issuers on the standards to use when considering a consumer's ability to repay. This new section, Section 150 of TILA, has an effective date of February 22, 2010.
"The Board has revised Regulation D's restrictions on the types and number of transfers and withdrawals that may be made from savings deposits. The final amendments increase from three to six the permissible monthly number of transfers or withdrawals from savings deposits by check, debit card, or similar order payable to third parties. Technological advancements have eliminated any rational basis for the distinction between transfers by these means and other types of pre-authorized or automatic transfers subject to the six-per-month limitation."
NAFCU has received quite a few inquiries from credit unions on this issue. Let's cover a few of the issues.