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Witnesses at a Senate Banking Committee hearing raised concerns about CFPB's mortgage rules cap on points and fees, the designation of rural status and the debt-to-income ratio requirements for qualified mortgages.

When asked by Chairman Richard Shelby, R-Ala., to name the biggest barriers to mortgage lending, David Motley, the president of Colonial Savings, said he recently had to turn away a self-employed borrower because he was a month short of CFPB's qualified mortgage requirement of 24 months in an employment situation. "We need some ability to exercise prudent judgment," Motley said.

Chris Polychron, executive broker at First Choice Realty, said the designation of rural areas can result in "a distortion" of the region's reality, and said communities should be able to appeal their status to CFPB.

In a letter to Shelby and Ranking Member Sherrod Brown, D-Ohio, which was entered into the record, NAFCU Senior Vice President of Government Affairs and General Counsel Carrie Hunt said a majority of credit unions are small financial institutions that operate with limited staff.

"It is a struggle for them to keep abreast with the constantly changing regulations and growing regulatory burden," Hunt wrote.

Sen. Bob Corker, R-Tenn., said many smaller problems would be eradicated by "comprehensive housing reform" and argued that reform would "create certainty" for financial institutions and borrowers having difficulty with compliance.

Sen. Donnelly, D-Ind., who cosponsored companion legislation for the House-passed H.R. 650, the "Preserving Access to Manufactured Housing Act," discussed the importance of manufactured housing. Sen. Tim Scott, R-S.C., discussed how "one size fits all" regulation is harmful from a small-business perspective and raised concerns about how the debt-to-income ratio rules might exclude consumers who are creditworthy.

NAFCU continues to monitor progress on these issues and is pushing for widespread regulatory relief for mortgage-servicing credit unions.