<p>WASHINGTON-It is not easy to get the ear of a large federal agency in Washington, D.C., much less having them call one up on the phone to request one's views on an issue. However, CUNA has managed to raise itself to the level that warrant a call from officials at the Federal Reserve about recent proposed changes to the Home Mortgage Disclosure Act (HMDA). While CUNA Assistant General Counsel Jeffrey Bloch admitted it is not often that the Fed (even a staff attorney as was the case) calls up CUNA looking for an opinion, it is becoming a more frequent occurrence. Most recently, the Fed contacted CUNA about when the interest rate on a mortgage loan is to be compared to the Treasury equivalent in deciding if the 3% spread has been triggered for disclosure. Currently, the proposal would have it recorded on the 15th of the month prior to locking in the loan rate. If the rates jumped significantly while a borrower `floated' a loan, the rate could require disclosure and appear predatory, even though it is not. Another option would be to compare the loan rates at the time of closing. Bloch explained that CUNA feels it would be more accurate to use the data from the date the loan is locked in. "Our opinion is that it would result in more accurate loan data.It would not result in any more burden." However, Bloch was quick to point out that the overall regulation in decidedly more onerous than the current rules. "If they're going to impose that kind of requirement of us, we'd like to go for the accuracy." Accuracy of the HMDA data is more important to credit unions, perhaps, than any other type of financial institution and more so than any other time, Bloch pointed out. The National Community Reinvestment Coalition (NCRC) filed a lawsuit at the beginning of the year against NCUA regarding the repeal of the Community Action Plan (CAP). NCRC also performed a study of HMDA data in connection with the suit, which alleged discriminatory practices in credit union lending. In its comment letter to the Fed on the proposed rulemaking, CUNA wrote, "We understand that the goal of the proposed rule is to combat the growing problem of predatory lending. We applaud this goal. However, we believe that enforcement of the current HMDA rules, the recent revisions to the Home Ownership and Equity Protection Act provisions of Regulation Z (HOEPA), and other recent regulatory initiatives have been sufficient in response to requests from Congress and consumers for more regulatory action to respond to these egregious lending practices." CUNA also said the requirement to report the spread would not be useful in identifying predatory loans, opposed the requirement to ask telephone applicants race, ethnicity, and gender information, and argued that reporting lien status information would be overly burdensome and costly in system changes and personnel training. [email protected]</p>

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