Within the past few years, the lending market has seen explosive growth in the number of payday lenders. Their short term small loans often result in APR values in the hundreds of percent. Calculating an APR value in compliance with Regulation Z for this type of loan is far more difficult than for more typical installment loans.

As many of you are aware, there has been a lot of recent pressure against payment protection (credit insurance/debt cancellation) on closed-end loans. Regulation Z has recently been amended to implement amendments to the Truth in Lending Act made by the Dodd-Frank Act. Section 1026.36(i) prohibits the financing of single premium credit insurance on a real estate secured loan.

Two new enhancements have been added in our latest quarterly SCEX release.

1. Service charges are now available for single payment, equal payment, and balloon payment loans. A service charge is typically a finance charge added to the loan in addition to interest and spread equally over the payments.

We are pleased to announce that Cash 1 has chosen Sherman & Associates as their exclusive partner for loan calculations within their loan origination system. Cash 1 will be using the Sherman Calculation Engine with XML Interface (SCEX) to drive the calculations within their new system.

Each quarterly release of the SCEX increases its lead as the most functional loan calculation engine, as we continue to implement enhancements requested by our partners.

Recently, many of these enhancements have been made in the area of mortgage calculations. At the end of 2010, the MDIA (Mortgage Disclosure Improvement Act) changes were implemented to ensure that our partners were within compliance by the time the new regulation was mandated. With our most recent release, the following enhancements have been made in the areas of PMI and FHA MIP (Mortgage Insurance Premium) calculations: