And the band played on

by. Henry Meier

Well, it’s official.  In the political equivalent of holding your breath until you get your way, so-called House Conservatives are so convinced that Obamacare should not exist that they really feel that if they keep government from spending money on itself long enough, legislators will come to their senses and decide not to implement the President’s major domestic achievement after all.  While this abject lesson in political imbecility will undoubtedly do some damage to the economy, it won’t have much of a short-term impact on the day-to-day operation of credit unions or their regulators.  It’s full speed ahead for Dodd-Frank’s regulations.

Yesterday, HUD came out with regulations proposing its version of a qualified mortgage.  What’s more, we only have thirty days to respond to this proposed QM standard, even though regulations of this importance should have at least a 60 day comment period.  In explaining why it is fast tracking the proposal, the regulator noted that unless it can get its regulations promulgated by January 10, 2014 an important source of financing for first time homebuyers and minorities will be subject to the CFPB’s QM definition.  HUD is concerned that the CFPB’s QM criteria ”is not focused on, to the extent that HUD’s definition is required to be, the populations that the mission of HUD is to serve.”  This is the bluntest assessment I have yet seen that Dodd-Frank may result in fewer individuals being qualified for home ownership.  The problem I have with HUD’s 30-day comment period is that it has had several months to respond to CFPB’s proposal.  The issues involved here are too complicated to be rushed through without an adequate public vetting and 30 days just isn’t enough time for an intelligent look for what HUD is proposing.

In the meantime, NCUA sent out a letter about the impending government shutdown.  Since it is funded by fees as opposed to general fund appropriations it avoids being subject to the shutdown.  And, of course, none of this directly impact’s New York State government.  Yesterday, Eric Schneiderman, New York’s Attorney General, announced a settlement with a group of debt collectors in relation to their collection efforts on behalf of pay day lenders.  The settlement is the latest in a series of escalating legal skirmishes between the state and pay day lenders over whether New York has the ability to clamp down on out of state pay day lenders and those based on tribal lands.