CUNA supports the Credit Union Residential Loan Parity Act
WASHINGTON, DC (January 10, 2017) —
The Honorable Ed Royce
U.S. House of Representatives
Washington, D.C. 20515
The Honorable Jared Huffman
U.S. House of Representatives
Washington, D.C. 20515
Dear Representatives Royce and Huffman:
On behalf of the Credit Union National Association (CUNA), I am writing in support of H.R. 389, the Credit Union Residential Loan Parity Act. The Credit Union National Association (CUNA) represents America’s state and federally chartered credit unions and their more than 100 million members. Thank you for your leadership on this issue.
H.R. 389 addresses a disparity in the treatment of certain residential loans made by banks and credit unions and would provide important regulatory relief for America’s credit unions. When a bank makes a loan to purchase a 1-4 unit non-owner occupied residential dwelling, the loan is classified as a residential real estate loan; however, if a credit union were to make the same, it would be classified as a business loan and therefore would be subject to the cap on member business lending under the Federal Credit Union Act. H.R. 389 would amend the Federal Credit Union Act to provide an exclusion from the cap for these loans. This exclusion would be consistent with the treatment of these loans proposed under the National Credit Union Administration’s pending risk-based capital regulation. In addition, H.R. 389 would authorize the National Credit Union Administration to apply strict underwriting and servicing requirements for the loans.
Enactment of this legislation would not only correct this disparity but it would also enable credit unions to provide additional credit to borrowers seeking to purchase residential units, including low-income rental units. Credit unions would be better able to meet the needs of their members, if this bill was enacted, and it would also contribute to the availability of affordable rental housing.
On behalf of America’s credit unions and over 100 million members, we appreciate the introduction of this legislation and look forward to working with you to ensure its enactment.
Sincerely,
Jim Nussle
President & CEO
About CUNA
Credit Union National Association (CUNA) is the only national association that advocates on behalf of all of America’s credit unions, which are owned by 135 million consumer members. CUNA, along with its network of affiliated state credit union leagues, delivers unwavering advocacy, continuous professional growth and operational confidence to protect the best interests of all credit unions. For more information about CUNA, visit cuna.org. To find your nearest credit union, visit YourMoneyFurther.com.
