The CFPB alleged that LendUp Loans violated the MLA by extending loans with an MAPR that was more than the 36% cap and extending loans that require borrowers to submit to arbitration.
The Bureau also alleged that the company failed to make certain required loan disclosures including a statement of the applicable APR.
Details of the proposed settlement between CFPB and LendUp Loans
According to the CFPB, the proposed settlement included $300,000 in redress to consumers and a $950,000 civil money penalty.
LendUp Loans is required to send a Redress Notice to affected consumers. In the notice, the company must state the total amount of interest and fees paid by the consumer and an itemization of any redress to be paid to the consumer.
Additionally, the settlement prohibits LendUp Loans from committing future violations of the MLA. It is also prohibited from collecting on, selling, or assigning any debts arising from loans that failed to comply with the MLA.
Furthermore, the settlement requires LendUp Loans to correct or update the information it provided to consumer reporting agencies about affected consumers.
