WASHINGTON–The TRID Improvement Act of 2018 (H.R. 5078) has passed in the House with a 53-5 vote. Amendments under the bill include clarifications to the Real Estate Settlement Procedures Act, requiring the Consumer Financial Protection Bureau to allow the accurate disclosure of title insurance premiums and any potential available discounts to homebuyers.
The bill had the backing of credit unions.
“This is a common-sense piece of legislation that would reduce confusion associated with the ability for title insurance companies to disclose available discounts,” said CUNA President/CEO Jim Nussle. “This kind of targeted regulatory relief benefits credit unions and consumers, who will have easier access to potential discounts. CUNA will continue our engagement with policymakers to see this bill move forward.”
Separately, CUNA and NAFCU sent separate letters to the House Small Business Committee in advance of a hearing on "How Red Tape Affects Community Banks and Credit Unions: A GAO Report."
The hearing examined a report by the United States Government Accountability Office (GAO) that assessed how regulations impact community banks and credit unions.
In its letter, NAFCU VP-legislative affairs Brad Thaler noted the recent GAO report found weaknesses in the way financial regulators assess the impact proposed rules could have on small institutions, including credit unions and the economy. The letter, addressed to Committee Chairman Steve Chabot (R-OH) and Ranking Member Nydia Velázquez (D-NY), also emphasized the need for regulatory relief for credit unions.
"The recent GAO report released in January found that regulators' analyses 'could undermine the goal of [Regulatory Flexibility Act (RFA)] and limit transparency and public accountability,'" said Thaler. "We also find it particularly worrisome that during the review of the CFPB's regulatory flexibility analyses it was found that some of their rules did not estimate compliance costs for small entities like credit unions."
The Consumer Financial Protection Bureau was one of six financial regulators examined in the report.
Meanwhile, in its letter CUNA said the “regulatory scheme created by the Dodd - Frank Act has made it more difficult and more expensive to provide these services. The current regulatory scheme favors the largest banks and nonbank financial services providers that can afford to absorb regulatory and compliance changes from thousands of pages of new rules and requirements.”
A recent study of the current financial impact on credit unions confirms this trend. The study, “2017 Regulatory Burden Financial Impact Study: An Elevated New Normal,” shows that credit union regulatory burden costs have increased to an “elevated new normal,” totaling an estimated $6.1 billion in 2016. Overall, costs are up more than $800 million compared with 2014. That is a 15.1% increase, which far exceeds the 2.8% inflation rate over the two-year period. In total, the credit union regulatory burden costs for 2016 translate to $115 per credit union household.
Expressing support for S. 2155, the Economic Growth, Regulatory Relief, CUNA went on to say that in addition to the regulatory burdens faced by credit unions, recent actions taken by predatory plaintiffs’ firms have also harmed their ability to serve consumers. CUNA also noted credit unions have recently become the subject of a wave of frivolous litigation alleged under the Americans with Disabilities Act and the Telephone Consumer Protection Act.
“Many credit unions are small businesses with extremely limited staff and resources and they often serve smaller or rural local communities that may otherwise have limited options for financial services,” said CUNA. “In the United States, nearly half of all credit unions, 2,708 out of approximately 6,000 credit unions, employ five or fewer full time employees. More than half (3,457) have assets of less than $50 million. Moreover, credit unions with less $20 million in assets account for over 40% of all U.S. credit unions (2,369).”