CFPB’s New Arbitration Rule Does Not Apply to Business Loans
The CFPB’s new rule to regulate arbitration clauses in consumer finance contracts does not apply to business loans, according to the agency’s fine print. Page 403 of 775 (that’s how long the rule is) includes a footnote that says:
As is explained in proposed comment 3(a)(1)(i)-1, Regulation B defines “credit” by reference to persons who meet the definition of “creditor” in Regulation B. Persons who do not regularly participate in credit decisions in the ordinary course of business, for example, are not creditors as defined by Regulation B. 12 CFR 1002.2(l). In addition, by proposing to cover only credit that is “consumer credit” under Regulation B, the Bureau was making clear that the proposal would not have applied to business loans.
Watch the video on what the CFPB’s rule is about below:
Sean Murray is the President and Chief Editor of deBanked and the founder of the Broker Fair Conference. Connect with me on LinkedIn or follow me on twitter. You can view all future deBanked events here.