Search
 

NCUA Preempts New Mexico Predatory Lending Law

ALEXANDRIA, Va. -NCUA recently issued a legal opinion preempting the New Mexico Home Loan Protection Act. Following a request from New Mexico Credit Union League Director of Governmental Affairs Tracey Rock, NCUA Associate General Counsel Sheila Albin wrote a legal opinion letter (04-0147) stating that the law, which addresses predatory...

By Staff Writer | Updated on February 24, 2004

ALEXANDRIA, Va. -NCUA recently issued a legal opinion preempting the New Mexico Home Loan Protection Act. Following a request from New Mexico Credit Union League Director of Governmental Affairs Tracey Rock, NCUA Associate General Counsel Sheila Albin wrote a legal opinion letter (04-0147) stating that the law, which addresses predatory practices by creditors making consumer mortgage loans, does not apply to federally chartered credit unions. Albin explained that because the state’s new law limits or affects the rates, terms of repayment and other conditions of loans and lines of credit, the law is preempted by NCUA’s lending regulation. Additionally, predatory lending is a non-issue with credit unions, she said. Albin wrote, “Credit unions are nonprofit cooperatives, owned by their members and democratically controlled, that may only lend and pay dividends to their members and, as such, are disinclined by their nature and structure to engage in the kinds of practices regarded as predatory or abusive.” Finally, she pointed out that the Federal Credit Union Act and NCUA regulations do contain significant consumer protections for all loans. The law is similar to those recently preempted in Georgia and New Jersey. In addition, it defines “high cost” loans as those exceeding established interest rate or closing costs and adds numerous restrictions and obligations to creditors offering them.

Complete your profile to continue reading and get FREE access to CUTimes.com, part of your ALM digital membership.

Your access to unlimited CUTimes.com content isn’t changing.
Once you are an ALM digital member, you’ll receive:

  • Critical CUTimes.com information including comprehensive product and service provider listings via the Marketplace Directory, CU Careers, resources from industry leaders, webcasts, and breaking news, analysis and more with our informative Newsletters.
  • Exclusive discounts on ALM and CU Times events.
  • Access to other award-winning ALM websites including Law.com and GlobeSt.com.

Already have an account?

NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

Recommended Stories

Credit Union Times

Join Credit Union Times

Don’t miss crucial strategic and tactical information necessary to run your institution and better serve your members. Join Credit Union Times now!

  • Free unlimited access to Credit Union Times' trusted and independent team of experts for extensive industry news, conference coverage, people features, statistical analysis, and regulation and technology updates.
  • Exclusive discounts on ALM and Credit Union Times events.
  • Access to other award-winning ALM websites including TreasuryandRisk.com and Law.com.

Already have an account? Sign In Now
Join Credit Union Times

Copyright © 2024 ALM Global, LLC. All Rights Reserved.