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Metsger Clears Senate To Become NCUA Board Member

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WASHINGTON (8/2/13)--The nomination of Richard Metsger to be the third member of the National Credit Union Administration board has been approved by the full U.S. Senate. All that remains to be done before Metsger takes his place on the board is for him to be sworn in.
Credit Union National Association Bill Cheney welcomed the news and thanked the Senate for confirming Metsger.
"We look forward to working with Mr. Metsger as he starts his tenure on the board, knowing that he can rely on his experience as a credit union board member in dealing with the challenges that credit unions face today," Cheney said.
Once sworn in, Metsger will join NCUA Chair Debbie Matz and board member Michael Fryzel, himself a former chair, to fill out the three-member board. Metsger will fill the seat vacated late last year after the term of board member Gigi Hyland expired.
The new NCUA board member's nomination was widely supported and moved fairly quickly through the confirmation process--at least compared to some controversial posts like newly confirmed Consumer Financial Protection Bureau Director's Richard Cordray's.
Metsger, a former Oregon state senator, was named as a candidate by President Obama in June and a hearing on his nomination was conducted June 27.

The next scheduled NCUA open board meeting is Sept. 12, as it is a longstanding NCUA practice to forego an August meeting. Barring unforeseen circumstances, Metsger should be ready to take his seat at the table by that time.

Student Loan Fix Heads To President's Desk

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WASHINGTON (8/2/13)--Legislation that would return the federal student loan rate to 3.4%, after it shot up to 6.8% in July, now needs only President Barack Obama's signature to become law.
The bill, known as the Bipartisan Student Loan Certainty Act, passed the U.S. House on a 392-31 vote this week. The Senate approved the bill last week.
The federal student loan rate, which was capped at 3.4%, increased to 6.8% on July 1 when members of Congress could not agree on legislation to address the issue.
The legislation approved this week would tie student loan interest rates to the 10-year Treasury note. Individual rates would be locked in for the life of the loan. Students and their families would also be protected for sharply increasing interest rates: Undergraduate loans could not exceed an interest rate of 8.25%.
The bill would save undergraduates $25 billion in student loan payments, and result in $3,300 less interest being charged per undergraduate student loan, according to congressional estimates.
Caps of 9.5% for graduate student loans and 10.5% for PLUS loans would also be set.
On the private student loan front, the National Credit Union Administration has told the Credit Union National Association that the agency will be releasing examiners' guidance on private student loans in the near future. The guidance will then be shared with credit unions.

NCUA Alerts CUs On ECOA Valuations Rule

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WASHINGTON (8/2/13)--Details of the Consumer Financial Protection Bureau's new rule on real estate appraisals and other written valuations under the Equal Credit Opportunity Act, and how the rule could impact credit unions, are addressed in a new National Credit Union Administration Regulatory Alert (13-RA-07).

The appraisal rule, issued under Regulation B, implements changes to the Equal Credit Opportunity Act (ECOA) that were made under the Dodd-Frank Wall Street Reform and Consumer Protection Act. It is intended to ensure that consumers can receive information prior to a loan closing about how the property's value was determined.

In the alert, the NCUA reminds credit unions that receive applications for first-lien loans to be secured by a dwelling on or after Jan. 18, 2014, that they must:
  • Notify applicants in writing within three days of receiving the application that they have the right to receive copies of all appraisals and written valuations; and
  • Provide a free copy of these appraisals and written valuations developed in connection with the loan application, promptly after they are completed, or three days before the loan closes, (whichever is earlier) regardless of whether the credit is extended, denied, incomplete, or withdrawn.
The NCUA regulatory alert also addresses what types of loans are covered under the rule, what constitutes an appraisal or other written valuation, when and how credit unions should deliver valuation copies to applicants, and how the ECOA valuation rule relates to a Higher-Priced Mortgage Loans (HPMLs) appraisal rule that was issued by the NCUA and five other federal financial institution regulators on Jan. 18.

Basic appraisal regulation requirements and compliance tips are also addressed.

The NCUA alert also links to the full text of the final rule, and CFPB compliance resources.

For the full alert, use the resource link.

CUNA: Ask Lawmakers To Tweet Tax, CU Support In August

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WASHINGTON (8/2/13)--Touting his 40-year credit union membership, Rep. Alan Lowenthal (D-Calif.), like other lawmakers
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recently--took to Twitter to tweet his support for credit unions, vowing to fight to retain their tax status.

August, with its five-week congressional district work period, is just the time for credit union advocates to meet with their lawmakers at home to spark more public messages of support, on tax and other key credit union issues, says Credit Union National Association Vice President of Legislative Affairs Ryan Donovan.

July 26 was the deadline for senators to submit their tax reform proposals to that chamber's Finance Committee leaders. "While that deadline has passed, you can bet legislators will be talking to each other over the summer," Donovan says.

After CUNA and the state credit union leagues ran a successful social media campaign, known as "DontTaxTuesday," more than 875,397 tweeted their support for credit unions and their tax exemption. Some legislators have made portions of their tax reform recommendations public.

Sen. Mark Begich (D-Alaska), for instance, said this week retaining the credit union tax exemption would "ensure continued access to affordable credit for consumers, homebuyers and small businesses alike, all of which contribute substantially to economic growth."

Others, including ranking House Ways and Means Committee Democrat Rep. Sander Levin (D-Mich.), Rep. Gary Peters (D-Mich.), House Intelligence Committee Chairman Mike Rogers (R-Mich.), and Rep. Dan Kildee (D-Mich.) have also spoken out in support of the credit union tax exemption. Still more legislators took to Twitter on July 23, like Reps. Lowenthal, Lloyd Doggett (D-Texas) and David Scott (D-Ga.).

Credit Unions will also need to continue advocating for other priorities, such as:
  • Separate House (H.R. 688) and Senate (S. 968) member business lending bills;
  • The Capital Access for Small Business and Jobs Act (H.R. 719), which would allow well-capitalized credit unions to match a growing deposit base from a growing membership with capital from sources other than retained earnings; and
  • Regulatory relief measures, including H.R. 2572, which would provide regulatory relief for credit unions and community banks.
"I don't want anyone for a second to think we have stopped these advocacy efforts. To the contrary, we will keep on advocating, with vigor," CUNA Executive Vice President of Government Affairs John Magill added.