WASHINGTON (11/5/13)--Continuous communication with the Consumer Financial Protection Bureau is one way the Credit Union National Association is working to minimize the regulatory burdens faced by credit unions, and CUNA in recent meetings has suggested steps that could ease qualified mortgage (QM) regulation compliance issues, CUNA Deputy General Counsel Mary Dunn said Monday.
The CFPB cannot, by statute, delay the compliance date of pending QM regulations. However, CUNA has called on regulators to give credit unions a buffer of at least six months as they work to come into compliance with the QM standards once the rule goes into effect. CUNA has also urged a similar six-month delay be applied to legal liability provisions of the regulation.
The QM regulations go into effect in January. The rule amends Regulation Z, which implements the Truth in Lending Act, to require creditors to make a reasonable, good faith determination of a consumer's ability to repay any consumer credit transaction secured by a dwelling--excluding an open-end credit plan, timeshare plan, reverse mortgage, or temporary loan. They also establish certain protections from liability under this requirement for "qualified mortgages."
The NCUA and other federal financial regulators late last month said offering only QMs "would not, absent other factors, elevate a supervised institution's fair lending risk." The statement came in response to creditor questions to the agencies.
Creditors, the regulators said, "should continue to evaluate fair lending risk as they would for other types of product selections, including by carefully monitoring policies and practices and implementing effective compliance management systems." (News Now, Oct. 23.)