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MoFo Reenforcement The Enforcement Blog

Will the True Lender Please Stand? – OCC Proposes “True Lender” Bright-Line Rule

Posted in Regulatory Developments

On July 20, 2020, the Office of the Comptroller of the Currency (OCC) issued a notice of proposed rulemaking that would establish when national banks or federal savings associations (collectively, banks) are the “true lender” making a loan in the context of a partnership between the bank and a third party.  Recognizing the uncertainty created by existing case law and lack of regulatory guidance, the OCC proposes that the bank will be treated as the “true lender” if, as of the date of origination, the bank is named as the lender in the loan agreement or the bank funds the loan.

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