CUNA opposes bill language to overturn unanimous SCOTUS ruling

May 11, 2021

CUNA and other organizations wrote to House leadership Tuesday with concerns over language in debt collection legislation which is expected to come up for a floor vote in the House this week.

A provision in H.R. 2547 would reverse a unanimous 2019 U.S. Supreme Court decision clarifying that entities enforcing a security interest without also seeking repayment or deficiency judgment generally do not qualify as debt collectors under the Fair Debt Collection Practices Act (FDCPA).

“We support the unanimous SCOTUS ruling and oppose any legislation designed to overturn the decision, which is consistent with the opinions filed in the supporting amicus,” the letter reads. “Such an outcome would disrupt the choices states have made in structuring their foreclosure regimes, imposing unnecessary costs and delay to the enforcement of real property interests and subsequently increasing the cost of credit.”

The organizations add that the mortgage lending system rests on “the foundation of enforceable security interests in real property,” and that this system reduces risk to lenders and in turn allows them to make credit available to more homebuyers at a lower interest rate.