Coleman: Mortgage rules ‘a giant regulatory burden’
Jan. 15, 2014 – NAFCU Director of Regulatory Affairs Mike Coleman, in an interview by The Hill on the implications of the new CFPB mortgage rules for the credit union industry, said the rules are “a giant regulatory burden” for the industry.
The paper’s On the Money blog described Coleman as “confident that most of the loans credit unions write will meet the ability-to-repay requirements because they already fall within their usual underwriting standards.” However, he also said many credit unions may not risk lending outside of the new qualified mortgage parameters even though the CFPB has encouraged credit unions to make non-qualified mortgages.
“These are very complicated rules and it’s very difficult for credit unions to digest,” Coleman said. “There are a lot of mortgage-related rules coming down at the same time. We won’t know their effect for a while.”
NAFCU Board member and CEO of Orion FCU Daniel Weickenand testified on Tuesday on the same subject, describing his Memphis-based credit union’s decision to stop offering non-qualified mortgage loans in light of the new regulations. Before the House Financial Services Subcommittee on Financial Institutions and Consumer Credit, Weickenand said, “I cannot tell you how difficult this decision has been. Orion takes great care in placing our members with the right mortgage product, and the QM standard will inevitably force us to turn many creditworthy borrowers away.”
NAFCU has posted compliance resources for credit unions that are available here.
The Hill interview
NAFCU Mortgage Rules Compliance Page