WASHINGTON — A flurry of activity on Capitol Hill in the last two days, has given credit unions a hopeful glimpse of the regulatory relief they have been seeking for years.
The House of Representatives approved eight regulatory relief bills Tuesday evening, including two controversial measures opposed by a number of Democratic lawmakers and the White House.
And on Wednesday, the Senate Banking Committee announced it scheduled a vote for highly anticipated regulatory relief legislation for May 14.
Both major credit union trade groups, CUNA and NAFCU, have been lobbying hard for reg relief in recent years. They applauded the votes in the House, including the approvals of bills that would impose changes to new mortgage rules, the Consumer Financial Protection Bureau and other financial provisions.
Those measures now move to the Senate for consideration.
"The American dream for so many low- and moderate-income Americans is that one day they can achieve financial independence," said Rep. Jeb Hensarling, R-Texas, chairman of the House Financial Services Committee. "We are trying to ensure that low- and moderate-income Americans have convenience, that they have choice, that they have lower prices."
Lawmakers debated two housing bills that would change the way certain points and fees are calculated under the CFPB's "qualified mortgage" rule and remove restrictions on the sale of some mobile homes. The points and fees bill passed 286-140 and the manufactured housing bill passed 263-162.
Many Democrats opposed the measures, and on Monday the White House issued a veto threat against both provisions in separate Statements of Administration Policy.
"By exempting certain fees from the 3% cap, H.R. 685 would allow lenders to increase the cost of loans and still be eligible for 'Qualified Mortgage' treatment," the administration wrote of the points and fees bill. "This revision risks eroding consumer protections and returning the mortgage market to the days of careless lending focused on short-term profits."
Rep. Maxine Waters, D-Calif., the ranking member on the banking panel, said Monday that the bills would "weaken the Consumer Financial Protection Bureau, roll back key protections for homeowners and leave consumers vulnerable to the same kinds of predatory lending practices that were all too common leading up to the financial crisis."
The chamber also passed half a dozen other bills by voice vote. Those provisions include an issue that long has been a CUNA/NAFCU favorite: allowing financial institutions to send out privacy notices when disclosures change rather than annually.
Other bills would require that any privileged information shared between state and federal regulators be kept confidential; decrease check-clearing times in some U.S. territories; mandate the CFPB hold open meetings; establish a designation appeals process for the definition of "rural" under the QM rule; and allow privately insured credit unions to access the Federal Home Loan Bank System.
On the Senate Side
Meanwhile, the Senate Banking Committee, led by Sen. Richard Shelby, R-Ala., has been working toward legislation on changes to the Dodd-Frank Act and other provisions since February, holding a number of hearings on the burdens to community and regional financial institutions, and exploring possible changes to the Federal Reserve and the Financial Stability Oversight Council.
Lawmakers will hold a hearing Thursday to look at new mortgage rules.
The committee previously had set a goal of finalizing Dodd-Frank reform legislation by April, but never set a formal date for a vote. Shelby has said he is focused on working with Democrats on a bipartisan bill, but the specifics of what a compromise might look like are not yet clear.