WASHINGTON (3/12/15)--During a CUNA Governmental Affairs Conference general session, Zixta Martinez, associate for external affairs at the Consumer Financial Protection Bureau (CFPB), called credit unions "key agents of change in their communities," and said the CFPB listens to credit union concerns for the effects new rules have on day-to-day operations.
|Zixta Martinez, associate for external affairs at the Consumer Financial Protection Bureau (CFPB), said the CFPB values comments from credit unions. (CUNA Photo)|
"The bureau is well aware that credit unions were not a cause of the financial crisis," Martinez said Wednesday. "You were not targeting vulnerable populations. You were not underwriting bad loans. And you were not selling off risk. Rather, you upheld sound underwriting standards and voiced your concerns about irresponsible practices in the mortgage market well before the recession."
As an example of a proposed rule that would benefit credit unions, Martinez cited changes to CFPB mortgage rules, prompted in part by credit union comments, that would expand the definition of "small creditor" by raising the loan origination limit for small-creditor status from 500 first-lien mortgage loans in the preceding year to 2,000 such loans.
The proposal would also expand the definition of "rural." The proposed rule would expand on the current definition of "rural" by adding all census blocks that are not in urban areas, as defined by the U.S. Census Bureau, which would further expand the coverage of "rural" to encompass about 22% of the population..
"We have undertaken this extra work and developed this proposal, again, because we strongly believe that smaller creditors such as credit unions play a vital role in ensuring access to credit for consumers in many communities--particularly in rural or underserved areas," Martinez said.
Martinez said the CFPB has worked to simplify the reporting process for Home Mortgage Disclosure Act (HMDA) regulations. "We propose to standardize the reporting threshold at 25 or more closed-end or reverse mortgages in a year," she said. "This would reduce the overall number of depository institutions required to report HMDA data by approximately 25%. We also propose to align the HMDA data requirements with well-established industry data standards, and to look at ways to improve public releases of HMDA data by modifying it to protect applicant and borrower privacy."
And, like credit unions, financial education is a key part of the CFPB's mission, Martinez said. The bureau recently issued a report that offers consumers a guide to make financial education a path to financial well-being. "The CFPB looks forward to working with CUNA and its members on the important task of bringing further awareness to financial capability," Martinez said.