Here's an update regarding what's up on Capitol Hill:
Cram down. HR 1106 passed the House. The legislation would give bankruptcy judges the power to "cram dowm" the outstanding balance on certain mortgages so that the balance is in line with the property's value. While the legislation as currently drafted would be very problematic for credit unions that do real estate loans, the bill now moves to the Senate. The word on the street is that the Senate is more likely to limit the scope of the legislation. For example, the scope could be limited to subprime loans. NAFCU's lobbyists are keeping a close eye on this and are communicating credit union concerns to all the right people.
Member business lending (MBL). Senator Charles E. Schumer (D-NY) announced plans to assist small businesses by eliminating the MBL cap found within the Federal Credit Union Act. (Wait. It can't be! Good news?!?) However, it is worth noting that such a change would involve a bill that passes both Houses and gets the signature of President Obama. But we'll keep a close eye on this one.
Financial reform. Representative Barney Frank (D-MA) announced that he will continue his vigorous financial reform agenda. Areas of interest include mortgage lending, overdraft protection, regulatory restructuring and credit cards. (That's a short but powerful list.)
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