National Credit Union Administration |
 | Sec. 706.2 Unfair credit practices.
(a) In connection with the extension of credit to consumers, it is
an unfair act or practice for a Federal credit union, directly or
indirectly, to take or receive from a consumer an obligation that:
(1) Constitutes or contains a cognovit or confession of judgment
(for purposes other than executory process in the State of Louisiana),
warrant of attorney, or other waiver of the right to notice and the
opportunity to be heard in the event of suit or process thereon.
(2) Constitutes or contains an executory waiver or a limitation of
exemption from attachment, execution, or other process on real or
personal property held, owned by, or due to the consumer, unless the
waiver applies solely to property subject to a security interest
executed in connection with the obligation.
(3) Constitutes or contains an assignment of wages or other earnings
unless:
(i) The assignment by its terms is revocable at the will of the
debtor, or
(ii) The assignment is a payroll deduction plan or preauthorized
payment plan, commencing at the time of the transaction, in which the
consumer authorizes a series of wage deductions as a method of making
each payment, or
(iii) The assignment applies only to wages or other earnings already
earned at the time of the assignment.
(4) Constitutes or contains a nonpossessory security interest in
household goods other than a purchase money security interest.
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