CUNA and NAFCU said the CFPB's proposed changes to its mortgage rules would benefit credit unions but some concerns remain.

The CFPB proposed expanding the definition of small creditor, which would increase the loan origination limit from 500 to 2,000. The proposal would also include mortgage affiliates into the calculation of small credit status. The asset threshold of $2 billion, which is adjusted annually, would remain the same.

"Responsible lending by community banks and credit unions did not cause the financial crisis, and our mortgage rules reflect the fact that small institutions play a vital role in many communities," CFPB Director Richard Cordray said Thursday. "Today's proposal will help consumers in rural or underserved areas access the mortgage credit they need, while still maintaining these important new consumer protections."

CUNA President/CEO Jim Nussle said the changes are an important step in the right direction but more work needs to be done.

"We're working with our mortgage lenders and member credit unions to submit a robust comment letter on these proposed changes," Nussle said. "The changes announced today will benefit a number of community lenders, including credit unions, across the country. Ultimately, the real winners are communities. As credit becomes more available, it's the growth of the communities across America that will develop in the long run."

Carrie Hunt, NAFCU's senior vice president of government affairs and general counsel, said the trade group supports the proposal but "continues to believe all credit unions should be exempt from rules implemented to address abuses in which credit unions did not participate."

"NAFCU welcomes CFPB's proposal to provide much-needed regulatory relief to credit unions wishing to continue providing mortgages to their members under the bureau's [qualified mortgage] regulation," Hunt said. "We strongly urged the bureau to set a more realistic exemption level for small creditors and appreciate CFPB's listening to our concerns and seeking to make its rule more workable."

Jared Ihrig, senior assistant general counsel at CUNA, told CU Times some credit unions are concerned about the $2 billion asset level.

"We've heard from many more institutions that have problems with that 500 first-lien limit so we're very pleased to see that raised," he said.

Ihrig added that CUNA welcomes discussions with the CFPB to change the $2 billion threshold.  

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