Feb. 28, 2013 – CFPB Director Richard Cordray, speaking at a credit union industry conference on Wednesday, said that the credit union lending model is “the kind of service-based model” that the CFPB wants to encourage in the financial marketplace.
On the CFPB’s view of credit unions, Cordray said, “You are member-focused, and you carefully protect the people you serve.” The CFPB recognizes and respects the credit union lending model, he said.
Cordray also discussed the CFPB’s ability-to-repay rule, mortgage servicing rules and escrow requirements and exemptions for each one.
The criteria for a “qualified mortgage” provided in the ability-to-repay rule focuses on the least risky types of loans, he said. “Plenty of responsible lending remains available” outside that specific space, he noted. “Those that lend responsibly – like credit unions – have no reason to fear the ability-to-repay rule,” he said.
Cordray added that the current mortgage market “creates a window of opportunity for credit unions that helped ‘write the book,’ so to speak, on what it means to underwrite responsibly.”
The CFPB director also discussed the CFPB’s Credit Union Advisory Council’s role in keeping the bureau informed on credit unions’ experience, and that of their members, under CFPB rules. He reiterated that credit unions “were not one of the causes of the recent financial crisis” but were “sounding the alarm bells well before the sinking of the economy.”