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Washington Archive

Washington

CUNA Urges CUs to Review New CFPB Mortgage Resources

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WASHINGTON (12/23/13)--The Credit Union National Association has encouraged credit unions to review mortgage rule resources released by the Consumer Financial Protection Bureau last week to become familiar with the resources that are now available to consumers.
 
"To the extent credit union members review and utilize this information, it will be beneficial for credit union mortgage lending staff to be aware of the contents of these documents to better assist members and manage the mortgage lending process effectively," CUNA Associate General Counsel Jared Ihrig said.
 
The CFPB said the documents were released to ensure that "potential homebuyers have the information they need to make responsible decisions and that current borrowers know about their new protections." The materials released include:
  • A quick reference guide to help housing counselors understand new federal protections so that borrowers can pursue all possible options before beginning the foreclosure process;
  • Tips on new rights under the new rules for homebuyers and homeowners at every stage of the mortgage process, and recommendations for troubled borrowers facing foreclosure;
  • A list of frequently asked mortgage-related questions;
  • A tool to help consumers find local housing counseling agencies to answer their questions or address their concerns; and
  • Factsheets with an overview of all of the new consumer protections in the CFPB's mortgage rules.
CUNA has been in discussions with the CFPB throughout the development of the rules, and expects 2014 to hold even more changes in the mortgage lending regulatory arena, Ihrig added.

Ally Financial Ordered to Repay $80M

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WASHINGTON (12/23/13)--Allegations of discriminatory auto loan markup policies have resulted in an $80 million settlement between Ally Financial, the U.S. Dept. of Justice and the Consumer Financial Protection Bureau.

Under the terms of the settlement, Ally will pay $80 million in damages to consumers harmed by an alleged discriminatory markup policy that was used between April 2011 and Dec. 2013. The policy impacted more than 235,000 African-American, Hispanic, and Asian and Pacific Islander borrowers, the CFPB claimed.

According to the CFPB/DOJ order, Ally allowed auto dealers to mark up a consumer's interest rate above Ally's established buy rate. The financial firm then compensated dealers with funds obtained through the markups. "Ally did not monitor whether discrimination on a prohibited basis occurred through the charging of markups," the order said.

The CFPB/DOJ complaint said an analysis of Ally's lending practices found:
  • African-American borrowers were charged 29 basis points more than similarly-situated non-Hispanic whites, resulting in them paying more than $300 more in interest over the lifetime of their loan contracts;
  • Hispanic borrowers were charged 20 basis points more than similarly-situated non-Hispanic whites, resulting in them paying more than $200 more in interest over the lifetime of their loan contracts; and
  • Asian/Pacific Islander borrowers were charged 20 basis points more than similarly-situated non-Hispanic whites, resulting in them paying more than $200 more in interest over the lifetime of their loan contracts.
The order called on Ally to cease this markup practice, establish a compliance committee, and regularly report to the CFPB and DOJ on its compliance with non-discriminatory lending laws.

For a CFPB release on the order, use the resource link.

NCUA Sets Jan.15 LICU Webinar

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ALEXANDRIA, Va. (12/23/13)--Tips for credit unions looking to improve their service to low-income members and the underserved will be provided during a Jan. 15 National Credit Union Administration webinar.

The free webinar, entitled "Profiling Products and Services for Underserved Members," is scheduled to begin at 2 p.m. (ET).

Vanessa Lowe from the NCUA's Office of Small Credit Union Initiatives will host the webinar. Joining her will be Elliot FCU, Jeannette, Pa., CEO James Benson, Marisol FCU, Phoenix, CEO Robin Romano, and St. Louis Community CU Vice President of Community Development Paul Woodruff.

These credit union leaders will discuss how they have developed innovative products for the underserved, including:
  • Second-chance loans and second-chance checking accounts;
  • Citizenship loans;
  • An alternative to payday loans funded with U.S. Treasury Community Development Financial Institutions Fund proceeds; and
  • Value-added partnerships with municipalities and community service organizations.
The webinar also will provide an overview of the NCUA Community Development Revolving Loan Fund 2014 grants round.

Webinar participants may submit questions in advance by sending an email to WebinarQuestions@ncua.gov. The subject line of the email should read, "Underserved Products and Services Webinar."

To register for the NCUA webinar, use the resource link.

Congress, Gov't Set Holiday Schedule

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WASHINGTON (12/23/13)--Like many in the rest of the country, members of the U.S. Congress and federal government employees get some much-needed time off during the holiday season.

The U.S. House has been out of session since Dec. 13, and the Senate finished its 2013 work late last week. Both bodies are scheduled to return to work on Jan. 6.

Federal agencies follow the U.S. Office of Personnel Management schedule over the holiday period, which means they are closed Dec. 25 and Jan. 1. Those agencies include:
  • The National Credit Union Administration;
  • The Federal Reserve;
  • The Consumer Financial Protection Bureau;
  • The Federal Housing Finance Agency;
  • The U.S. Small Business Administration;
  • The Federal Trade Commission;
  • The U.S. Treasury;
  • The Office of the Comptroller of the Currency; and
  • The U.S. Dept. of Housing and Urban Development.
Credit unions can check their state regulator's website for those holiday schedules.

FHFA Receives $1.9B in Deutsche Bank Settlement

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WASHINGTON (12/23/13)--Deutsche Bank AG, related companies and specifically named individuals will pay $1.925 billion to the Federal Housing Finance Agency under a settlement announced Friday.

The settlement will resolve allegations that Deutsche Bank AG and others violated federal and state securities laws when they sold private-label mortgage-backed securities (MBS) to Fannie Mae and Freddie Mac between 2005 and 2007.

Freddie Mac will receive $1.63 billion of the settlement and Fannie Mae will receive $300 million. The settlement will release Deutsche Bank from certain claims tied to the securities sales, but will not impact claims related to alleged LIBOR manipulation nor claims made in two other suits: FHFA v. SC Americas, Inc., et. al., and FHFA v. Countrywide Financial Corp., et. al.

This is the sixth MBS settlement FHFA has reached. The National Credit Union Administration is not involved in this settlement.

For more on the settlement, use the resource link.

CU Holiday Efforts Covered in Cheney Report

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WASHINGTON (12/23/13)--One credit union's efforts to heighten the holiday season for overseas servicemembers and Unite for Good are highlighted in this week's edition of The Cheney Report.

Staff members at Arrowhead CU, San Bernardino, Calif., recruited members, families, friends and first graders at nearby East Heritage Elementary School to help make hundreds of holiday cards to send to on-duty Air Force service men and women stationed abroad. More than 300 cards were specially made and sent to the Air Force for those deployed in Afghanistan, sharing the credit union and holiday spirit of people helping people, Cheney noted.

CUNA is collecting these stories to showcase how credit unions are joining forces to Unite for Good, and similar stories will be featured each week in The Cheney Report. Cheney continues to encourage credit unions to visit UniteforGood.org and share how they are helping reach CUNA's shared, strategic vision in which Americans choose credit unions as their best financial partner.

This week's Cheney Report also includes:
  • Details on expected National Credit Union Administration board nominee J. Mark McWatters;
  • CUNA's recent testimony on patent issues;
  • Budget Committee Chairman Paul Ryan's (R-Wis.) comments on the future of tax reform efforts; and
  • An "Inside Exchange" video featuring tips on how to deal with the media.
The results of last week's National Credit Union Administration open board meeting.

Use the resource link to read the latest in The Cheney Report.