WASHINGTON (5/5/14)--This morning, the Credit Union National Association is contacting each member of the House of Representatives, urging them to pass three credit union relief bills that are expected to come up for a vote in that chamber this week .
Those bills are the Capital Access for Small Community Financial Institutions Act (H.R. 3584), H.R. 2672, which would grant credit unions and other lenders greater input into rural-area designations made by the Consumer Financial Protection Bureau, and The Community Institution Mortgage Relief Act (H.R. 3468) (News Now
Also this morning, CUNA is sending a series of letters to key lawmakers on Capitol Hill, thanking them for their leadership in developing other measures that will provide regulatory relief for credit unions--a top priority for CUNA--and for considering CUNA's views on behalf of credit unions while developing their bills.
"CUNA, the state credit union leagues, and credit unions have worked tirelessly to inform lawmakers of the crisis of creeping complexity credit unions face with respect to regulatory burden. There are now a series of bills in the House that will, if passed, attack the problem from many directions," Ryan Donovan, CUNA senior vice president of legislative affairs, said Friday and added, "These are significant developments."
In its appreciation letters, CUNA stated its strong support for the following bill that are expected to be considered by the House Financial Services Committee this week:
The Financial Regulatory Clarity Act (H.R. 4461), introduced by introduced by Reps. Shelley Moore Capito and Gregory Meeks, the chair and ranking member of the House Financial Services subcommittee on financial institutions and consumer credit. The bill would require financial regulators to determine whether new regulations are duplicative or inconsistent with existing federal regulations. Unnecessary regulatory burden could be avoided if regulators took these steps, so we strongly support this commonsense piece of legislation, CUNA wrote.
H.R. 2673, the Portfolio Lending and Mortgage Access Act introduced by Rep. Andy Barr (R-Ky.), which would treat mortgages held in portfolio at credit unions and other mortgage lenders as qualified mortgages for purposes of the Consumer Financial Protection Bureau mortgage lending rules. CUNA noted that it is appropriate to treat loans held on balance sheets as QMs because the lender retains all of the risk involved with the mortgages and is subject to significant safety and soundness supervision from its prudential regulator. The statutory change, if made, will help credit unions, many of which are primarily portfolio lenders, continue to provide mortgage credit to their members, CUNA wrote.
H.R. 4521, introduced by Rep. Luetkemeyer (R-Mo.), would exempt credit unions under $10 billion in assets from a Dodd-Frank Act requirement that mortgage lenders must hold an escrow account for five years for higher priced, first-lien mortgages secured by borrower's principal dwelling. The requirement has forced some credit unions to shy away from higher priced mortgages because of the expertise that is required to establish and maintain the escrow accounts. CUNA noted that Dodd-Frank conveyed authority to the CFPB to exempt credit unions and other classes of entities from its rules to keep the regulatory burden on community financial institutions measured. However, the bureau has failed to exercise that authority to its fullest possibilities, making bills like Luetkemeyer's necessary, CUNA wrote. H.R. 4521 also improves the exemption threshold for small servicers of mortgage loans from Section 6 of the Real Estate Settlement Procedures Act.
In its separate letter to all House members, CUNA urged passage of:
H.R. 3584 , the Capital Access for Small Community Financial Institutions Act, introduced by Reps. Steve Stivers (R-Ohio) and Joyce Beatty (D-Ohio), a bill to correct a drafting error in the Federal Home Loan Bank (FHLB) Act thereby allowing-state chartered, privately insured credit unions to join the FHLB system. The change would give 132 privately insured credit unions across the country additional opportunities to provide mortgage credit to their members, CUNA has noted.
The Community Institution Mortgage Relief Act (H.R. 3468). Reps. Ed Royce (R-Calif.) and Ed Perlmutter (D-Colo.) have introduced this bill to provide National Credit Union Share Insurance Fund (NCUSIF) coverage for trust accounts, such as Interest on Lawyer Trust Accounts (IOLTAS) and other similar accounts. CUNA backs this bill as necessary because the National Credit Union Administration has interpreted that the Federal Credit Union Act does not permit it to extend such coverage. H.R. 3468 would provide parity in the insurance treatment of trust accounts offered by credit unions with the treatment of similar accounts offered by banks.
H.R. 2672, which would grant credit unions and other lenders greater input into rural-area designations made by the Consumer Financial Protection Bureau. The rural county designations determined by regulators can impact the types of products credit unions may offer their members in those areas and CUNA maintains that any time credit unions can gain an additional opportunity to provide input into the process, they should do so.
When the letters are posted to the CUNA website, they will be available through the resource link below.