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Sens. Scott, Cortez Masto introduce NAFCU-sought NCUA loan flexibility bill
Senate Banking Committee Members Tim Scott, R-S.C., and Catherine Cortez Masto, D-Nev., Wednesday introduced NAFCU-sought legislation, the Expanding Access to Lending Options Act (S. 3389), that would give the NCUA greater flexibility in setting loan maturity limits under the Federal Credit Union Act. Reps. Lee Zeldin, R-N.Y., and Vicente Gonzalez, D-Texas, previously introduced a NAFCU-sought House version for loan maturity relief last March.
"NAFCU thanks Senators Tim Scott and Catherine Cortez Masto for offering this bipartisan legislation to help credit unions improve flexibility in offering members credit," said NAFCU President and CEO Dan Berger. “The current 15-year limit on certain loans is outdated and does not conform to maturities that are commonly accepted in today’s marketplace.
"We are confident that credit unions and their 120 million members will benefit from this legislation, as it provides the NCUA flexibility for maturity products up to 20-years and removes restrictive requirements on 30-year mortgages," Berger added. "NAFCU will continue to engage with all members of Congress as we advocate on this important issue.”
NAFCU has long advocated for credit unions to have flexibility with respect to loan maturity limits. In August 2018, the NCUA issued a proposal inviting comment on extending maturity limits for certain types of loans as part of a proposal to consolidate and streamline its lending regulations. NAFCU was very supportive of any changes that the agency could make, but recognized that certain changes might require legislative action.
Additionally, the NCUA last March finalized a rule to reform loans and lines of credit to credit union members and indicated it will continue to review comments on other maturity limit issues. For more on NAFCU's efforts and position, download the Loan Maturity Limits Issue Brief.
Reforming loan maturity limits to enable credit unions to grow is included in NAFCU's 2020 priorities, and having bipartisan bills introduced in both chambers greatly increases the chances of legislation moving. NAFCU will monitor the bill as it moves through the Senate and update credit unions via NAFCU Today.