NAFCU applauds Luetkemeyer’s introduction of ‘Stop and Study’ legislation

WASHINGTON, DC (March 4, 2015) — National Association of Federal Credit Unions (NAFCU) Senior Vice President of Government Affairs and General Counsel Carrie Hunt issued the following statement in response to NAFCU-sought legislation introduced today by House Financial Services Subcommittee Chairman Blaine Luetkemeyer, R-Mo., that would require the National Credit Union Administration (NCUA) to conduct a study on mortgage servicing assets and report to Congress within one year.

“We appreciate Chairman Luetkemeyer’s leadership in pressing for added regulatory relief and for working to ensure credit unions parity with other institutions with respect to capital requirements,” Hunt said. “This bill would promote much-needed transparency, require a thorough analysis of the agency’s second risk-based capital proposal’s impact on mortgage servicing assets and encourage NCUA to take more time to consider the full impact of its capital rules.”

The study, if enacted, will afford the NCUA additional time to truly analyze the impact of its second risk-based capital proposal on credit unions’ mortgage servicing assets before moving forward with a flawed rule.

Luetkemeyer’s bill, titled the “Community Lending Enhancement and Regulatory Relief Act of 2015,” would direct NCUA to look at risk associated with mortgage servicing assets, the history of the market (particularly during the financial crisis), regulatory approaches to addressing related risk other than through capital and more.

Chairman of the House Financial Services Subcommittee on Housing and Insurance, Luetkemeyer introduced similar legislation last Congress. This version, however, provides NAFCU-sought parity for credit unions in its proposed study of mortgage servicing asset capital requirements.

Other provisions of the bill would give statutory relief regarding privacy notices; waive escrow mandates for mortgage loans held in portfolio; provide an exemption from independent appraisals for loans of $250,000 or less held in portfolio; and give a QM safe harbor for all loans held in portfolio.

The National Association of Federal Credit Unions is the only national trade association that exclusively represents the interests of federally chartered credit unions before the federal government and the public.

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