Compliance Blog

Written by JiJi Bahhur, Director of Regulatory Compliance

Last week, we blogged about NCUA’s Regulatory Alert on Ability-to-Repay (ATR) and Qualified Mortgages (QM), two of several mortgage rules that go into effect as of today.   In the Regulatory Alert, NCUA stated that it would be releasing a Supervisory Letter to its examiners pertaining to the subject matter.  As promised, the Supervisory Letter accompanied NCUA’s Letter to Credit Unions 14-CU-01 as an enclosure. 

The Letter to Credit Unions (Letter) reiterates that “NCUA field staff will take into account a credit union’s good –faith efforts to comply with the new rule.”  Further, the Letter emphasizes that credit unions may originate both QM and non-QM loans, explaining that non-QM lending can be an effective member service if conducted safely and soundly.  NCUA’s field staff will be placing an emphasis on safety and soundness implications which will not be judged solely on the basis of a loan’s status as QM or non-QM.

Addressed to the NCUA Examiners, the enclosed Supervisory Letter provides guidance to credit union mortgage lenders on the expectations for complying with the Consumer Financial Protection Bureau (CFPB)’s final ATR and QM rules.  It describes specific examination procedures and expectations for credit unions and may serve as another handy tool for preparing for your examination.

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Fannie Mae Updates. As a follow-up to our recent blogs (here and here) on FHFA fee increases, FHFA Director Mel Watt announced that his agency is reconsidering guaranteed fee hikes announced last year by Fannie Mae and Freddie Mac.  Watt also stated that any changes in fees will not be implemented for at least 120 days following review.

Other recent Fannie Mae news:  Fannie Mae published a new web page with information about the recently implemented Appraiser Quality Monitoring (AQM) process (described in Lender Letter LL-2013-10). The new AQM page includes FAQs and a link to the AQM list identifying appraisers whose appraisals will be subject to 100% review by Fannie Mae or whose appraisals are no longer accepted by Fannie Mae.  

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I wish you all a happy Friday and a great weekend!