Removing Barriers Blog

CUNA’s 360-degree Advocacy-in-Action: Senator Warren’s Legislation Excludes Credit Unions from the CRA
Posted March 14, 2019 by CUNA Advocacy

Yesterday, CUNA wrote letters to Senator Warren and to Representatives Richmond, Moore, Cummings and Lee in support of the American Housing and Economic Mobility Act of 2019.  This legislation is an updated version of the Senator’s housing legislation, a version of the bill that reflects significant engagement between CUNA, leagues, credit unions and Warren. Unlike the previous version, the American Housing and Economic Mobility Act of 2019 would not require credit unions to comply with the Community Reinvestment Act (CRA).

As stated in the letter, the American Housing and Economic Mobility Act of 2019 is an important effort to improve access to the housing market for members of all communities and, in the process, properly recognizes the distinctions that exist between credit unions and banks when meeting community needs. The legislation rejects a one-size-fits all approach by explicitly excluding credit unions from the Community Reinvestment Act and instead codifying the already existing community outreach, input, and oversight policies that credit unions have been abiding by for more than 20 years under National Credit Union Administration regulations.

“This bill is a shining example of 360-degree advocacy in action. When Senator Warren initially planned to expand CRA and place onerous and duplicative regulations on credit unions, we collaborated with League partners and the Senator to show the many ways that credit unions have been fulfilling requirements to support underserved communities for well over two decades. Recognizing the power that credit unions bring these communities, Senator Warren pivoted to instead codify into law the regulations that have been dictating our actions for many years. We look forward to working with the Senator and other likeminded lawmakers to ensure that credit unions are able to continue serving these communities for the foreseeable future.” – Jim Nussle, CUNA’s President & CEO

Through months of engagement between credit unions, leagues, Warren and her staff, and other Members of Congress, CUNA demonstrated that credit unions already abide by rules that ensure they provide safe and affordable housing products to members of varying socio-economic statuses without being subject to the CRA. Recent CUNA research shows that more than half of all credit union mortgages made across America went to households earning middle incomes or less.

Subjecting credit unions to CRA requirements would require them to shift resources away from increasing access to responsible financial products in order to satisfy additional compliance demands.  That result would frustrate, rather than benefit, the objectives of increasing access to credit and capital in underserved communities.

Instead, the current bill adopts an approach that codifies the existing community outreach, input and oversight polices already present in NCUA regulations. Credit unions have been abiding by those polices for more than 20 years.

CUNA thanks Senator Warren and her staff for their engagement on the bill and for "working with us to develop an approach that better serves the interests of communities."