WASHINGTON (6/25/13)--The "Ability to Repay" rule fixes contained in Rep. Bill Huzienga's (R-Mich.) Consumer Mortgage Choice Act (H.R. 1077) would address many credit union concerns, the Credit Union National Association wrote in a Monday letter to the legislator.
The Consumer Financial Protection Bureau in May finalized changes to the "Ability to Repay" rule, which will require lenders to determine a borrower's ability to repay before writing a mortgage loan. The rule is slated to take effect on Jan. 10, 2014.
CUNA remains concerned about the definition of points and fees in the amended CFPB rule, CUNA President/CEO Bill Cheney wrote. "Specifically, we are concerned that the inclusion of affiliated title charges remains as part of the points and fees definition," he said.
Huzienga's legislation addresses CUNA's concerns by excluding from the definition "all title charges, regardless of whether they are charged by an affiliated company, provided they are bona fide and reasonable."
Cheney said "defining points and fees in this way will maintain a competitive marketplace, prevent over-pricing or limiting choice in low-moderate income areas and allow consumers to enjoy the existing benefit of working through one entity for their new mortgage or refinance."
Huzienga's bill also addresses loan level price adjustment exclusions contained in the bill. These exclusions, if not eliminated, would impair the availability of credit for some credit union members, the CUNA letter warned.
For the full letter, use the resource link.