New rules for CU alternatives
May 4, 2010 | alternatives, federal legislation, industry | Comments (0)Issued by the NCUA:
Federal credit union alternatives to payday loans could range from $200 to $1,000, have a maximum APR of 1,000 basis points above the interest rate ceiling and carry an application fee of no more than $20.
Those are among the provisions of the proposed rules that the NCUA Board voted unanimously last Thursday to approve for a 60-day comment period.
Under the current interest rate ceiling, the maximum APR would be 28%. The loans could be for a minimum of one month and a maximum of six months, and any member couldn’t have more than one such loan from any one credit union at the same time.
Federal credit union alternatives to payday loans could range from $200 to $1,000, have a maximum APR of 1,000 basis points above the interest rate ceiling and carry an application fee of no more than $20.
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