Appraisal, donation account regs final

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Dec. 13, 2013 – NCUA’s board received a briefing on a recently approved supplemental rule on appraisals and voted its approval of another rule, supported by NAFCU, to authorize federal credit unions to establish charitable donation accounts have been by the NCUA Board.

The supplemental appraisal regulation, approved by notation vote Dec. 10 and including amendments sought by NAFCU, applies to higher-priced mortgage loans and takes effect Jan. 18. It includes exemptions for transactions secured by existing manufactured homes and not land; certain streamlined refinancings; and transactions of $25,000 or less. It also removes Saturday from the definition of “business day,” which the requirement to notify a member within three days of application if an appraisal will be required.

The rule’s added flexibility aside, NAFCU is continuing discussions with NCUA and CFPB to seek rule changes that would mitigate growth in regulatory burden and its impact on credit union operations and the marketplace.

The board voted 3-0 Thursday to approve its final rule on charitable donation accounts, which is set to take effect upon its publication in the Federal Register.

The rule defines a CDA as a hybrid charitable and investment vehicle and lists it as a preapproved incidental power activity for federal credit unions. It limits CDA investments in the aggregate to 5 percent of a federal credit union’s net worth. It also requires the account to make charitable donations of at least 51 percent of net total return at least every five years, and when it terminates.