WASHINGTON (9/22/15)--The Consumer Financial Protection Bureau (CFPB) finalized its proposal Monday expanding the definition of “small creditor” to include those institutions that originate and sell fewer than 2,000 mortgages per year, and have less than $2 billion in assets. These same creditors can provide an unlimited amount of loans held in portfolio and still receive the small creditor status under the revised Qualified Mortgage (QM) regulation.
The CFPB’s rule, which will take effect Jan. 1, 2016, also increases the number of financial institutions able to offer certain mortgages in rural and underserved areas.
In its comment letter on the proposal, CUNA recommended the asset threshold be raised to $10 billion. Nevertheless, with this final rule, more small-creditor loans will be considered Qualified Mortgages, receiving safe harbor legal status.
CUNA will be assessing the complete impact of the final rule, but believes this is a step in the right direction for regulatory relief for credit unions.
“CUNA applauds the CFPB for providing much needed regulatory relief for smaller credit unions,” said Elizabeth Eurgubian, CUNA’s deputy chief advocacy officer. “We remain concerned with the inclusion of affiliate assets in the $2 billion threshold. We hope the CFPB will continue to refine rulemaking in this area.”