FCUs Can't Overdraw Accounts To Pay LoanArrearages

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ALEXANDRIA, Va. - (08/04/04) -- Federal credit unions are prohibitedfrom overdrawing a member's regular share or share draft account tocredit the member's overdue loan payments, NCUA said in a new legalopinion letter that the FCU Act and the agency's own regulations donot allow a federal credit union to overdraw an account, unlessthere is a prior agreement between the member and the creditunion.

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