This may just be an effort by the banks to further muddy the water and obscure the difference between lawful money and legal tender. Note that the distinction between lawful money and FRN's is only the demand, since the actual paper notes now circulate at parity, and the US Notes do not circulate at all. The Federal Reserve would like for everyone to just forget lawful money, as it is still in competition with their fake debt money, and they don't get to tax it... and whenever anyone figures out lawful money, they quickly figure out the voluntary debt servitude scam the banks have foisted on the 'US citizen' public. Or it could just be a variation on the requirement on B of A's account contract which requires all deposits to be in 'US currency;' they don't want to have to deal with loonies, euro's, etc, what with their variable rates of exchange. Also note that the credit union is likely going to accept the note for value and sell it, to raise the money they are going to loan to you, so you have already loaned your credit to the FR through the note; the bank may be intending to put your payments into a loan account for their own tracking purposes, but I doubt they will handle it as lawful money once they receive it.