UPDATED WITH ADDITIONAL SPEAKERS/TIME CHANGES

Noting that supporters of mortgage bankruptcy legislation are considering amendments consistent with President Obama’s proposal on the issue, CUNA has asked Speaker of the House Nancy Pelosi (D-Calif.) to delay consideration of HR 1106, the “Helping Families Save Their Homes Act.”

The legislation, which was postponed from further consideration last week, is scheduled to be brought up again in the House this week.

In a letter to Speaker Pelosi, CUNA President and CEO Dan Mica requested the delay to allow time for details of the president’s initiative to “be fully analyzed.” He added that “ We expect that details of the President’s plan will be announced later this week.”

“We respectfully request sufficient time to analyze the President’s proposal and continue to work with proponents of judicial modification. Our hope is that the President’s proposal with respect to pre-bankruptcy loan modification and the legislative remedy providing for judicial modification can work in concert,” Mica wrote.

The CUNA leader noted that credit unions keep nearly three quarters of all mortgages in portfolio. “As a result, credit unions have more flexibility in working with their members,” he added. “In fact, in a recent survey of credit union executives, the vast majority of respondents indicated that they are pro-actively offering services aimed at preventing foreclosures including loan payment deferrals, extension of maturities and reduction of interest rates, among other things.”

Mica stated that credit unions continue to act responsibly in these difficult times, but they worry that the unintended consequences of this legislation may have an adverse affect on their ability to serve their members.

The complete text of Mica’s letter to Speaker Pelosi follows:

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March 2, 2009



The Honorable Nancy Pelosi

Speaker

United States House of Representatives

Washington, DC 20515



Dear Madame Speaker:



On behalf of the Credit Union National Association (CUNA), I am writing regarding H.R. 1106, the Helping Families Save Their Homes Act. CUNA represents nearly 90 percent of America’s 8,000 credit unions and their 90 million members.

Since 2007, credit unions have been working with supporters of legislation permitting judicial modification of loans secured by a primary residence to ensure that such legislation was an effective remedy of last resort for borrowers who were the victims of predatory mortgage lending. We have sought to limit the scope, application and duration of such legislation to target the problem at hand – unnecessary foreclosures caused by inappropriate mortgages – and minimize its unintended consequences.

We appreciate that House consideration of H.R. 1106 was postponed last week and encourage you to continue to postpone consideration of this bill until the details of the President’s loan modification initiative can be fully analyzed. We expect that details of the President’s plan will be announced later this week.

It is our understanding that supporters of this legislation are considering amendments to mortgage bankruptcy legislation that would permit judicial modification of mortgages only if the lender had not offered a loan modification consistent with the President’s proposal. We respectfully request sufficient time to analyze the President’s proposal and continue to work with proponents of judicial modification. Our hope is that the President’s proposal with respect to pre-bankruptcy loan modification and the legislative remedy providing for judicial modification can work in concert.

Credit unions keep nearly three quarters of all mortgages in portfolio. As a result, credit unions have more flexibility in working with their members. In fact, in a recent survey of credit union executives, the vast majority of respondents indicated that they are pro-actively offering services aimed at preventing foreclosures including loan payment deferrals, extension of maturities and reduction of interest rates, among other things. Credit unions continue to act responsibly in these difficult times, but they worry that the unintended consequences of this legislation may have an adverse affect on their ability to serve their members.

We hope you will consider postponing consideration of H.R. 1106 until the details of the President’s plan can by analyzed. On behalf of America’s credit unions, thank you very much for your consideration.

Sincerely,

Daniel A. Mica

President & CEO

Credit Union Natl. Assn.

Washington, DC