Removing Barriers Blog

Letter sent prior to hearing on HFSC Subcommittee hearing re: Protecting Homeowners During the Pandemic
Posted July 15, 2020 by CUNA Advocacy

Prior to the Subcommittee's hearing, CUNA wrote to Chairman Green and Ranking Member Barr about the need for credit unions to remain in a position to help Americans and small businesses across the country as COVID-19 persists. With that in mind, extending the Troubled Debt Restructuring (TDR) exemption and Central Liquidity Facility (CLF) enhancements through 2021 would have a significant impact in ensuring credit unions continue to be there for their members. 

The TDR exemption, created by the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), will expire at the end of 2020, or 60 days after the end of the national emergency, whichever is earlier. We believe the current situation warrants that this deadline be extended. We encourage the Committee and Congress to extend the CARES Act’s temporary TDR relief for an additional year, until the end of 2021, and to continue working with the financial regulators to ensure the interagency guidance on TDRs remains in effect for the duration of the crisis and its aftershocks. 

The CLF is a quasi-government corporation created to improve the financial stability of credit unions. This is accomplished by serving as a lender to credit unions experiencing unexpected liquidity shortfalls. The CLF exists within the NCUA and member credit unions own the facility. Due to the anticipation of the biggest demand for liquidity will almost certainly occur later in 2021, we encourage the Committee and Congress to extend the enhancements to the CLF through 2021 and increase the borrowing authority multiplier from sixteen to twenty-five.

In addition to extending the TDR exemption and CLF enhancements, we also wrote in support of mortgage and rental assistance programs.

H.R. 6820, the Emergency Rental Assistance and Rental Market Stabilization Act of 2020 which would establish a $100 billion emergency rental assistance program that is directed to the states; and

S. 3620, which would establish a $75 billion Housing Assistance Fund which would provide those resources directly to state Housing Finance Agencies. These are models that we believe can and should be expanded.