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Senate Banking Committee Members Tim Scott, R-S.C., and Catherine Cortez Masto, D-Nev., Tuesday introduced NAFCU-sought legislation that would give the NCUA greater flexibility in setting loan maturity limits under the Federal Credit Union Act.

"NAFCU thanks Senators Tim Scott and Catherine Cortez Masto for introducing legislation that will provide credit unions and their members with better tailored options for loans," said NAFCU President and CEO Dan Berger. "The coronavirus pandemic has underlined the need for several reforms to ensure credit unions can provide products and services that meet members' needs, and providing the NCUA flexibility for maturity products and removing restrictive requirements on certain loans is a step in the right direction.

"NAFCU will continue its longstanding advocacy to modernize the outdated, 15-year limit on certain loans and help bring credit union maturities in line with today's marketplace."

Extending credit unions' loan maturity limits under the Federal Credit Union Act has been a key component of NAFCU's advocacy amid the coronavirus pandemic. Similar legislation was introduced by Scott and Cortez Masto last year and in the House in 2019.

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 supportive of any changes that the agency could make, but recognized that certain changes might require legislative action.

Additionally, the NCUA in March 2019 finalized the 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.

NAFCU will monitor the bill as it moves through the Senate and update credit unions via NAFCU Today.