S. 2155 FAQs addressed in new Compliance Blog
A new post on NAFCU's Compliance Blog details the implications the recently enacted Economic Growth, Regulatory Relief and Consumer Protection Act (S. 2155) will have on credit unions. Specifically, the blog covers questions related to the Home Mortgage Disclosure Act (HMDA), member business loan (MBL) cap and qualified mortgages, among others.
NAFCU Vice President of Regulatory Compliance Brandy Bruyere writes that media coverage of S. 2155 has created confusion around some provisions that need clarification. Those include:
- "Financial institution" definition under HMDA: Bruyere notes that S. 2155 does not change HMDA's definition of a financial institution, but rather adds a threshold for those that are required to collect and report certain HMDA data points added by Dodd-Frank. Now, certain financial institutions – those that do not originate 500 closed-end mortgage loans or 500 open-end lines of credit – will not have to report as much data. NAFCU members can find a chart comparing "old" HMDA to "new" HMDA data points here.
- MBL relief related to its cap, not maturity limits: S. 2155 removes certain loans – those that are fully secured by a lien on a one-to-four family dwelling that is not the primary residence of the member – from the statutory MBL cap. Bruyere adds that the act does not raise the maturity limit for these loans. The NCUA last week approved a rule to amend its member business lending rule to conform it to the law.
- New safe harbor category of qualified mortgages: S. 2155 adds another safe harbor category of qualified mortgages to the applicable section of the Truth in Lending Act (TILA). Bruyere explains that this new category applies to loans made by depository institutions with under $10 billion in assets when the loan meets certain conditions. Bruyere notes that regulatory clarification is possible related to required documentation.
- Foreclosure time period under the Servicemembers Civil Relief Act (SCRA): The change made to the SCRA by S. 2155 provides protection to servicemembers from foreclosure for a year (previously 9 months) following active duty service.
- Elder abuse training required: S. 2155 carves out immunity from a civil or administrative proceeding for individuals who disclose suspected exploitation of a senior citizen to certain entities if specific conditions are met, including receiving training. It also provides content requirements for training, though Bruyere notes that regulatory guidance will likely be needed.
Bruyere writes that many of the changes made by S. 2155 do not have clear effective dates "and will need to be implemented by regulators." NAFCU's compliance team will keep credit unions updated on these compliance deadlines.