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News Now

Washington
CUNA to FTC Dont impose loan-mod rules on state CUs
WASHINGTON (7/17/09)--State-chartered credit unions subject to Federal Trade Commission (FTC) jurisdiction should not be required to follow new rules applicable to those who offer loan modifications and foreclosure rescue services, said the Credit Union National Association (CUNA) in a recent comment letter. CUNA wrote in response to an advanced notice of proposed rulemaking (ANPR) from the FTC that addresses the practices of those who offer loan modification and foreclosure rescue services to consumers. The ANPR requests general comments as to whether the FTC should develop rules to restrict or prohibit activities in these areas. CUNA argued that the rules should not apply to state-chartered credit unions because they have not been the source of problems involving modifications and foreclosure rescues, and because the rules are not applicable to federal credit unions. “No matter how laudable, CUNA would not support rules which would only apply to one segment of the credit union industry,” the letter said. If state-chartered credit unions are covered by the new rules, they also would be subjected to new regulatory burdens that will add to their compliance costs, CUNA said. However, CUNA agrees that the FTC should move forward in this process to determine if additional rules should be implemented to restrict or prohibit practices that take advantage of vulnerable homeowners who seek loan modification or foreclosure rescue services. Credit unions are working with those members who are having difficulty in meeting their mortgage obligations by providing loan modifications, including the refinance and loan modification options that are available under the Treasury Department’s Making Home Affordable Programs. Although credit unions are offering their members valuable assistance in this area, CUNA recognizes that there are unscrupulous firms and individuals who offer loan modification and foreclosure rescue services to consumers.


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