WASHINGTON (7/16/15)--Consumer Financial Protection Bureau (CFPB) Director Richard Cordray told the Senate Banking Committee Wednesday that the lending practices of credit unions and community banks are the most consumer-friendly of the nation's financial institutions.
Cordray addressed the committee for his semiannual report to Congress.
“We’d like to see credit unions and community banks lend more. Throughout the financial crisis they had lower defaults than anyone else,” Cordray said. “They are the most responsible lenders we have, and the more lending they do in accordance with their traditional underwriting model, the better it is for consumers, the better it is for our economy.”
Cordray also provided some insight into the bureau’s early examination of its Truth in Lending Act-Real Estate Settlement Procedures Act integrated disclosures (TRID) rule, which the bureau has proposed to implement Oct. 3.
“The early examination of this will be diagnostic and corrective. We don’t think people are out there trying to exploit consumers on something like this, they’re just trying to get it right,” he said. “So for the first period, which may last many months, if we see errors, we’ll point out what they are and how they should be corrected. We will not be looking to be punitive toward people.”
CUNA submitted a letter for the record of the hearing, urging committee members to examine making structural changes at the CFPB, because its regulations are affecting credit unions’ ability to serve their members.
Among other things, CUNA outlined the ways the CFPB has created barriers preventing credit unions from most effectively serving their members, and expressed support for a number of pieces of legislation that would help remove those barriers.