The Latest CUs Should Know from CFPB, NCUA, and FFIEC

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This week, credit unions received a handful of important regulatory news alerts from the Consumer Financial Protection Bureau (CFPB), the National Credit Union Administration (NCUA), and the Federal Financial Institutions Examination Council (FFIEC):

Agencies Announce Threshold for Smaller Loan Excemption from Appraisal Requirements for Higher-Priced Mortgage Loans
The CFPB, the Federal Reserve Board, and the Office of the Comptroller of the Currency have announced that the 2022 threshold for exempting loans from special appraisal requirements for higher-priced mortgage loans will increase from $27,200 to $28,500.

The threshold amount will be effective Jan. 1, 2022, and is based on the annual percentage increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers, known as CPI-W, as of June 1, 2021. The Dodd-Frank Act added special appraisal requirements for higher-priced mortgage loans, including that creditors obtain a written appraisal based on a physical visit to the interior of the home before making a higher-priced mortgage loan. The rules implementing these requirements contain an exemption for loans of $25,000 or less, adjusted annually to reflect CPI-W increases.

You can view the notice in the Federal Register.

CFPB Research Shows Banks’ Deep Dependence on Overdraft Fees
Banks continue to rely heavily on overdraft and non-sufficient funds (NSF) revenue, which reached an estimated $15.47 billion in 2019, according to research released by the CFPB.

Three banks — JPMorgan Chase, Wells Fargo, and Bank of America — brought in 44 percent of the total reported that year by banks with assets over $1 billion. The CFPB also found that while small institutions with overdraft programs charged lower fees on average, consumer outcomes were similar to those found at larger banks. The research also notes that, despite a drop in fees collected, many of the fee harvesting practices persisted during the COVID-19 pandemic.

2022 Truth in Lending (Regulation Z) Annual Threshold Adjustments (Credit Cards, HOEPA, and Qualified Mortgages)
On Nov. 2, 2021, the CFPB published its Truth in Lending (Regulation Z) Annual Threshold Adjustments (Credit Cards, HOEPA, and Qualified Mortgages) Final Rule in the Federal Register.

The CFPB is required to calculate the dollar amounts for several provisions in Regulation Z each year. These include provisions in the Credit Card Accountability Responsibility and Disclosure Act of 2009 (CARD Act), the Home Ownership and Equity Protection Act of 1994 (HOEPA), and the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act).

Federal and State Regulators Release Updates to the BSA/AML Examination Manual
The Federal Financial Institutions Examination Council (FFIEC) has released one new section and updates to three sections of the Bank Secrecy Act/Anti-Money Laundering (BSA/AML) Examination Manual.

The updates affect the following sections: Introduction - Customers (new); Charities and Nonprofit Organizations; Independent Automated Teller Machine Owners or Operators; and Politically Exposed Persons.

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