Regulatory fallout from the housing crash, the Credit Card Act of 2009 and the new Consumer Financial Protection Bureau are making the daily duties of a loan officer look increasingly more like those of a compliance officer. Below are the most burdensome, difficult and confusing current regulations and proposed rules facing credit union lending officers today.
Credit Card Look Back
The credit Card Act of 2009 required institutions to continuously review and monitor the business reasons behind raising a cardholder's interest rate or the institution's overall interest rates. For example, if a member's credit score decreases due to a job loss or other event and the credit union raises his or her interest rate, regulations require a review of the member's credit score six months later to see if it has improved. If it has, the credit union must lower the rate accordingly. Additionally, if a credit union increases its credit card APRs across the board or in any risk-based category, it would have to document the business reasons for the increase and re-evaluate the decision after six months to ensure the business reasons are still valid.
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