DCUC sends letters on concerns with new CDFI Target Market Assessment Methodologies

WASHINGTON, DC (January 18, 2023) — The Defense Credit Union Council (DCUC) recently sent a letter to Senator Sherrod C. Brown (D-OH), Chairman, and Senator Tim E. Scott (R-SC), Ranking Member, of the Senate Committee on Banking, Housing, and Urban Affairs regarding its concerns with New CDFI Target Market assessment methodologies.

DCUC emphasized the impact credit unions have on the military and veteran communities they serve. Military installations are often located within lower-income communities and/or rural areas that tend to lack common public infrastructure. Additionally, military personnel, especially the younger, lower-ranked ones who make up the bulk of our Nation’s military, typically meet the threshold for the CDFI Fund’s Low Income Targeted Population levels under the established criteria. In its letter, DCUC stressed the fact many military families are currently struggling with food insecurity, a lack of adequate spouse employment options, access to affordable childcare, and a lack of affordable housing, as well as the majority are stationed further away from their families’ support. Given these issues, it’s evident credit unions hold an important role in assisting military members with their daily financial needs.

The Credit Union National Association (CUNA) supplied an analysis of the 2021 Home Mortgage Disclosure Act (HDMA) data which further revealed how imperative defense credit unions’ services are to their military and veteran members’ overall financial well-being.  DCUC’s letter emphasized the following data included in CUNA’s report:

  • Applicants for first mortgage* originations at military credit unions reflected average income of $130,189 – well below the $169,164 average at US commercial banks

*Defined as 1-4 family, owner-occupied mortgage originations for FHA/VA/FSA/RHS, Conventional, and Refinancings.

  • Military credit union first mortgage loan amounts averaged $282,486 – well below the $327,840 average at US commercial banks
  • Overall, 10.8% of military credit union first mortgage loan originations were to African Americans – over double the 4.8% share of total originations at commercial banks
  • Overall, 10.2% of military credit union first mortgage loan originations were to Hispanic Americans – nearly double the 6.6% share of total originations at commercial banks

The data highlights how important credit unions’ dedication to supporting the housing needs among lower-income and minority communities is, with homeownership being a key driver of wealth and intergenerational wealth transfers.

Scheduled to take effect in April 2023, the new CDFI Target Market assessment methodologies conflict with legal restrictions on obtaining racial, disability, or other demographic data per the Equal Credit Opportunity Act and Regulation B. This would preclude defense credit unions from legally obtaining this data. DCUC also highlighted how other options for satisfying legal requirements are very burdensome and costly, especially for smaller credit unions (many of these operating on military installations.

The result of the New CDFI Target Market assessment methodologies would directly limit defense credit unions’ abilities to maintain or become CDFI-certified and obtain Federal funding for their military and veteran members.

DCUC requested the committee review these methodologies and evaluate if a legislative fix is necessary.

“These downstream effects on the military community make this unacceptable for those who wear our nation’s cloth,” wrote Anthony Hernandez, DCUC president/CEO. “Defense credit unions are responsible lenders and have always offered quality products and services to keep predatory lending away from our military. This commitment to doing right by its members is why our member credit unions are dedicated to all DoD personnel on the installation.”

For more information on how DCUC advocates for credit unions dedicated to serving our Nation’s military and veterans, visit


About Defense Credit Union Council (DCUC)

The Defense Credit Union Council is the premier resource for credit unions on all military and veteran matters. By maintaining a close and constant liaison with the Pentagon, Capitol Hill, and NCUA, the Council champions the interests of credit unions serving our military and veteran communities by coordinating policy, procedures, and legislation impacting morale and welfare, financial readiness, and the delivery of quality financial products and services. Organized in 1963, the Council’s membership is comprised of 180 credit unions with over 35 million members. If you would like more information about this topic, please contact DCUC at


Haleigh Laverty



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