League Hosts Meeting With CFPB

Last Thursday, your League hosted a virtual meeting with staff members of the Consumer Financial Protection Bureau. In a wide-ranging discussion, credit union and League participants covered a host of topics, including pandemic relief measures, proposed regulation and consumer protections related to mortgage lending.

Among the highlights:

• Credit union participants provided an overview of their experiences with workout plans and forbearance measures as they relate to Reg X and borrower protections put into place under RESPA for borrowers affected by COVID. Credit union participants also noted other efforts during the pandemic to aid members.
• Educating members about available resources was another important tool used by credit unions during the pandemic, including resources such as the CFPB's own rental assistance finder. Virginia boasted high utilization of this service, evidence of credit unions and others having passed on the information to consumers in need.
• Credit unions also noted their mortgage underwriting and anti-discrimination efforts, which included a discussion of automated valuation models.
• The CFPB recently announced a proposed new rule, mandated by Congress in section 1071 of the Dodd-Frank Act, that would, if finalized, require lenders to disclose information about their lending to small businesses. While supportive of the goals outlined in 1071, your League strongly encouraged the CFPB to consider the regulatory compliance burden of this rule and look for avenues to address that burden for credit unions and other small institutions. Aside from the costs, credit unions also noted other concerns with the proposed rule, including how field-of-membership restrictions would affect reporting by credit unions and comparisons of data with other lenders.
• During the meeting, the CFPB also provided an overview of the compliance resources it makes available to credit unions.
• Your League continues to push for tailored regulations, given that regulatory burden has a greater impact on small financial institutions, like credit unions, in terms of technology, staff time, training, etc.

"This was an important opportunity to engage with CFPB staff on our issues," noted League Senior Vice President David Miles. "I think it's important that regulators hear from us regarding our regulatory challenges. While they no doubt appreciate the difficulty smaller institutions face in regulatory compliance, it's helpful for them to hear our real-world experiences."