A bipartisan group of legislators introduced a bill, the Credit Union Residential Loan Parity Act, H.R. 389, that would allow credit unions to lend more money to finance the acquisition of small apartment buildings.
“The Credit Union Residential Loan Parity Act unleashes billions of dollars of capital for small businesses at no cost to taxpayers and drives local economic investment,” said U.S. Rep. Ed Royce (R-CA), one of the sponsors of the bill along with Reps. Jared Huffman (D-CA), Don Young (R-AK), and Peter DeFazio (D-OR).
“I look forward to working with Chairman Hensarling to advance this regulatory relief,” Royce said.
The bill eliminates the member business lending (MBL) cap currently placed on credit unions when lending for the purchase of non-owner occupied dwelling with one to four units.
“Credit unions are vital to local communities and their economies on the North Coast and across America,” Huffman said. “The Credit Union Residential Loan Parity Act is a common-sense, bipartisan fix that ensures credit unions are able to do their job and assist small businesses in accessing capital, and making investments in local economies, while boosting the construction and housing sectors.”
The bill, if passed, would enable credit unions to lend an additional $11 billion to small businesses, freeing up more financing for rental housing.
“This legislation is good for business and good for consumers,” Young said. “Not only does it free up capital and expand access to responsible home lending, it provides community lenders with some commonsense regulatory relief.”
DeFazio said the legislation puts credit unions on equal footing with banks and provides an additional option for investment capital. “Credit unions should not be constrained by arbitrary regulations that impair their ability to serve members who wish to invest in small residential properties,” he said.