‘Higher-priced’ mortgage rule draws concerns

Jan. 11, 2013 – The NCUA Board received a briefing Thursday on an interagency “higher-priced” mortgage rule that NAFCU has concerns with, and the board also approved five items impacting credit unions, including a final rule to amend the definition of “troubled condition.”

NAFCU had urged NCUA and CFPB to refrain from moving forward with the interagency rule on “higher-priced” mortgages, which would impose new notification requirements on creditors regarding appraisals. Specifically, it would require creditors to obtain an appraisal or appraisals meeting certain specified standards, and also require creditors to provide applicants with a notification regarding the use of the appraisals. Creditors would also be required to provide applicants with a copy of the written appraisals used.

NAFCU President and CEO Fred Becker said that the rule should include, at the very least, additional exemptions for certain types and classes of loans, as NAFCU has advocated. “Unfortunately, this rulemaking, especially when combined with the other mortgage-related rules that are currently being finalized, could fundamentally change credit unions’ mortgage lending and negatively impact credit union members,” Becker cautioned.

In other action, the NCUA Board approved a final rule that permits either NCUA or a state supervisory authority to declare a federally insured, state-chartered to be in “troubled condition.” Regarding the rule, Becker said NAFCU “appreciates the agency’s efforts to seek consistency and address developments affecting the share insurance fund.” He added, “As a general rule, we will continue to encourage NCUA to seek avenues to ensure the safety and soundness of the fund.”

The NCUA Board also approved:

  • a final rule that extends the deadline for accepting NCUA’s offered designation of “low-income” from 30 days to 90 days, as NAFCU had urged;
  • a final rule making technical amendments regarding Treasury tax and loan depositaries and depositaries and financial agents of the government;
  • the agency’s 2013 annual performance plan (separate from NCUA’s 2013 operating budget).
  • NCUA Board action bulletin