NAFCU letter to Senate urging action on regulatory relief measures for credit unions
(September 26, 2014) —
The Honorable Harry Reid The Honorable Mitch McConnell
Majority Leader Minority Leader
United States Senate United States Senate
522 Hart Senate Office Building 317 Russell Senate Office Building
Washington, D.C. 20510 Washington, D.C. 20510
Re: Senate Action Needed on Credit Union Regulatory Relief
Dear Leader Reid and Leader McConnell:
On behalf of the National Association of Federal Credit Unions (NAFCU), the only trade association exclusively representing the interests of our nation’s federally chartered credit unions, I write today to urge you and your colleagues to act when the Senate returns on November the 12th on three bipartisan regulatory relief measures that would help relieve regulatory burden at our nation’s credit unions. The measures outlined below, each of which has passed the House, would take small but meaningful steps toward the kind of regulatory relief credit unions need to continue to provide their 98 million members with basic financial services products and impeccable service.
Relief from Redundant Annual Privacy Notices
IOLTA Parity for Credit Unions
NAFCU also strongly supports legislation (S.2699, along with S. 2698) that would provide important relief to credit unions with Interest on Lawyers Trust Accounts (IOLTAs). Maintaining parity between the coverage provided by the National Credit Union Share Insurance Fund (NCUSIF) and the Federal Deposit Insurance Corporation (FDIC) on all types of deposits and accounts is imperative and a longstanding goal of NAFCU member credit unions. Consumers often do not distinguish between the government backing on accounts at financial institutions. It is important that the law dictate that there is no difference in coverage, so as not to favor one type of institution over another in the marketplace. NAFCU is pleased that the legislation will provide NCUSIF parity with the FDIC for certain accounts, including IOLTAs. NAFCU applauds Senators King, Warner, Tester and Fischer for their leadership on this issue. Similar legislation passed the House by voice vote earlier this year and we urge the Senate to act on this issue.
QM Points and Fees Fix
NAFCU also urges your support for the Mortgage Choice Act of 2013 (S. 1577) introduced by Senators Machin, Johanns, Toomey, Kirk and Stabenow. This bipartisan legislation would bring much needed relief to credit unions by altering the definition of points and fees under the Consumer Financial Protection Bureau’s “Qualified Mortgage” (QM) rule. The Mortgage Choice Act of 2013 would make important changes that would exclude affiliated title charges from the “points and fees” definition, and clarify that escrow charges should be excluded from any calculation of “points and fees.” These changes would greatly improve the definition of “points and fees” used to determine whether a loan meets the QM test, and would ensure that those with low and moderate means would continue to be able to obtain their mortgages from their credit union at a reasonable price. Identical legislation passed the House earlier this year by voice vote.
NAFCU wants to be clear that regulatory relief is needed for all credit unions. The above measures are three small steps to provide that relief. Each of these measures enjoys bipartisan support in the Senate and passed with overwhelming bipartisan support in the House. We hope that the Senate will not adjourn this session of Congress without acting on these issues as well. Regulatory relief efforts are critical to the survival of credit unions and consideration and passage of these pieces of legislation would go a long way toward assisting our nation’s credit unions and their members.
Thank you for your consideration. If my colleagues or I can be of assistance to you, or if you have any questions regarding regulatory relief for our nation’s credit unions, please feel free to contact myself, or NAFCU’s Director of Legislative Affairs, Jillian Pevo, at 703-842-2836.
Vice President of Legislative Affairs
cc: Members of the United States Senate