CUNA Mutual Vows to Assist With MFOEL Changes
Credit unions can expect assistance from CUNA Mutual Group with the recent changes involving multi-featured open-end lending and blending lending, the company said.
A July 20 NCUA letter to federal credit unions confirms regulations continue to allow MFOEL. However, it provides limitations on the amount of information a credit union may gather at the time of an advance request, which will limit the use of MFOEL for some credit unions.
“CUNA Mutual has worked with credit unions on lending compliance issues for more than 30 years and provides lending products that ensure compliance,” Bill Klewin, CUNA Mutual’s director of regulatory compliance, said in a statement. “We will help credit unions through this change and continue to be here for them as the many new regulations emerge.”
In the letter, the NCUA also discussed blended or multi-featured lending plans. The regulator clarified that open-end and closed-end lending are two distinct regimens and each require their own application, timing requirements and disclosures for the member-borrower.
The letter discussed blended loan programs, which combine open-end and closed-end processes and disclosures. The letter makes clear such an approach is not the same as an MFOEL program and that such an approach must follow the distinct rules for open-end and closed-end lending, depending on the nature of the transaction, CUNA Mutual said.
Klewin said CUNA Mutual welcomes the NCUA’s efforts to clarify the compliance requirements surrounding multi-featured open-end lending and blended lending and that the company will continue to support credit unions to ensure an effective balance of safety and soundness, member convenience and compliance requirements.