CUNA letter to CFPB’s Richard Cordray
WASHINGTON, DC (January 10, 2014) —
The Honorable Richard Cordray
Consumer Financial Protection Bureau
1801 L Street NW
Washington, D.C. 20036
Dear Director Cordray:
I trust you had an enjoyable holiday season, and want to wish you a very Happy New Year.
I was able to catch your appearance on “The Daily Show” Wednesday evening and was pleased with the comments you made regarding credit unions relative to the new mortgage rules. More specifically, you stated that the rules are “really taking mortgage lending back to what community banks and credit unions have done for decades, checking out the numbers to make sure people can actually succeed in the loan, not just giving it to them and not caring if they fail.”
I could not agree more and as we have stated on numerous occasions, because of their pro-consumer lending practices that have resulted in very low default and delinquency rates, credit unions do not need new rules to force them to treat their borrowers fairly.
Your appearance with Jon Stewart came on the heels of comments you reportedly made to the National Association of Realtors this week in which you suggested that the exemption level under the Ability to Repay (ATR) Rule for community based institutions may be rethought at the CFPB.
Now that the initial task of developing the mortgage rules is behind the CFPB, CUNA urges the agency to revisit exemption issues as soon as possible. We do not think the agency’s reconsideration should be limited to the ATR Rule but should include other mortgage rules and the international remittance transfer rule as well.
We feel strongly that the agency has solid statutory authority to exempt credit unions broadly, particularly from regulations designed to address abuses in which credit unions were not engaged. In that connection, I am resending to you a detailed legal analysis which demonstrates convincingly, we believe, that CFPB does indeed enjoy broad authority to exempt credit unions and other community financial institutions from its rules or specific provisions in its rules. The memorandum was prepared by outside counsel with extensive experience at the Federal Reserve and at the CFPB itself.
We urge the CFPB to give this issue the consideration it deserves in light of the impact of the CFPB’s major rules on credit unions.
I would welcome the opportunity for CUNA to meet with you on the exemption issues soon and will work with your office to try to set that up, depending on your availability.
In the meantime, CUNA and our members look forward to working constructively with you and your agency throughout this year and your tenure, as we have in the past.
President & CEO