Entrance to the CFPB, Washington, D.C. (Source: Shutterstock)
There were two moves by NAFCU and CUNA on Monday that might seem in opposition, but could have the same end goal in mind: Keep the CFPB in check.
When it comes to keeping things the same, NAFCU filed a letter with the CFPB asking officials to not change any of the mortgage loan originator rules as listed under Regulation Z. The CFPB must review the mortgage loan originator rules regularly, and NAFCU Regulatory Affairs Counsel James Akin said the current rules in place already provide "consistency and trust" and that changing the rules would be disruptive.
Akin wrote that the "Loan Originator rules have been instrumental in promoting consistency and trust in mortgage lending, while also deterring bad actors from engaging in misleading practices. Due to the complexity of mortgage lending, these rules have established a reliable and equitable framework for all stakeholders involved. Given their long-standing presence, changing these rules would be highly disruptive and potentially more challenging than maintaining the status quo."
He continued, "Despite some complexity to the rules, NAFCU believes that they are not overly burdensome or costly. While there may have been initial challenges for credit unions in adapting to the new regulations, at this point, adhering to these rules has become a standard part of credit union business processes."
In the letter, Akin did ask the CFPB "to clarify that compensation to mortgage loan originators based on overall loan growth is permitted."
When it comes to making changes to the CFPB, CUNA praised a piece of legislation introduced Monday by Sen. John Kennedy (R-La.) that would require the bureau to produce a detailed cost-benefit analysis to any rulemaking coming from the CFPB.
According to CUNA, the bill would require the CFPB to publish the following items with any rulemaking:
- A statement of need for the regulation.
- An examination of why the private market or other authorities cannot address the problem.
- An examination of whether the proposal is duplicative or inconsistent with other federal regulations, and additional justifications if it is.
- An assessment of all anticipated direct and indirect costs and benefits of the proposed regulation.
In a statement, CUNA President/CEO Jim Nussle said, "We thank Sen. Kennedy for introducing this bill that would bring needed accountability and transparency to the CFPB. The entities subject to the bureau's rules and regulations deserve an honest breakdown of costs and benefits, information that will also be beneficial to consumers, lawmakers and small businesses."
Louisiana Credit Union League SVP Lacey Weaver said, "We applaud Sen. Kennedy's leadership in introducing the League-supported Transparency in CFPB Cost-Benefit Analysis Act. Regulations established by the CFPB are not only burdensome to implement but carry unreasonable compliance costs with no justification in the rule making process. This proposed legislation addresses the short-sighted processes by regulators and the excessive costs that are ultimately passed down to the consumer."
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Michael Ogden
Editor-in-Chief at CU Times. To connect, email at [email protected]. As Editor-in-Chief of CU Times since 2016, Michael Ogden has led the editorial team in all aspects of content strategy and execution, including the creation of the publication’s exclusive and proprietary research database of the credit union industry’s economic landscape. Under Michael’s leadership, CU Times has successfully shifted to an all-digital editorial product with new focuses on the payments, fraud, lending and regulatory beats. Most recently, he introduced a data-focused editorial product for subscribers that breaks down credit union issues into hard data, allowing for a deeper and more factual narrative for readers. In 2024, he launched the "Shared Accounts With CU Times" podcast, which offers a fresh, inside-the-newsroom perspective through interviews with leaders from the credit union industry and the regulatory world. He dives into pressing credit union issues, while revealing the personalities working behind-the-scenes to push the credit union world forward. His background includes years as a radio and TV anchor/reporter and a public relations and digital/social media manager, where he covered the food and music industries, as well as cooperatives and credit unions. Over the years, he has launched numerous exclusive video and podcast series, including a successful series of interactive backstage interviews with musicians at music festivals, showcasing his social media and live streaming production skills.
