CUNA strongly supports legislation that would provide the NCUA board the flexibility to increase federal credit union loan maturity limits, it wrote to the House Financial Services Committee Tuesday. The committee conducted a hearing on student loan debt, and CUNA’s letter highlights the ways credit unions could support student borrowers if certain barriers were removed.
“While most student loans originate with the government, more and more credit unions are finding ways to support student borrowers through private loans. However, one barrier for many federal credit unions from entering the student lending sector is the 15-year loan maturity limit,” the letter reads. Except for mortgage lending, Federally-chartered credit unions are prohibited by statute from making loans with maturity limits in excess of 15 years… The ability to set a longer loan maturity for Federal credit union loans would provide more opportunities for education that is more affordable.”
H.R. 1661 would grant the NCUA board flexibility to increase federal credit union loan maturities past 15 years. Currently only one state, Oklahoma, has a similar restriction on state credit unions, and there is no such limit for banks.