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SC CUs see surge after fee pledge, brace for “Bank Transfer Day”
COLUMBIA, S.C. and SPARTANBURG, S.C. (10/31/11)—A grassroots movement started by a 27-year-old entrepreneur angry at her bank has since spread virally across the country in what is now known as “Bank Transfer Day.” More than 64,000 people on Facebook have accepted an invitation to “Bank Transfer Day,” by which they will move their accounts from a bank to a credit union, and another 375,000 have accepted invitations from their friends via the social networking site.
Several South Carolina credit unions are preparing for an influx of new members as Bank Transfer Day (BTD) approaches, while others already have witnessed a surge.
“We have already seen more than 190 new accounts opened at our credit union over the past few weeks” said Spartanburg Regional FCU CEO Pat West. “Every day the call volume is picking up (with) people who are looking for alternatives to their current financial institution” West said.
In an article in The State, Palmetto Citizens FCU President and CEO Nick Wodogaza has seen a 20-percent increase in new accounts and expects that number to grow as customers of some of the nation’s largest banks begin to see the new monthly debit card fee reflected on their bank statements.
PCFCU was one of thirty-two credit unions to join an impromptu grassroots pledge drive in which they promised “…to uphold the credit union philosophy of ‘people helping people’ by continuing to offer fairly priced banking services to our members. In addition, I pledge that my credit union will abstain from charging a fee for members to use our debit cards for as long as market conditions allow us to do so.”
“The whole philosophy behind credit unions is people helping people” said Carolina Collegiate FCU CEO Anne Shivers. “While we understand the need for banks to look for ways to survive under new regulations, we believe in providing the best banking experience for our members, with as little cost to them as possible” Shivers said.
The League has for member credit unions a set of CUNA-prepared materials to support response to Bank Transfer Day, including: (1) a "ready sheet" on how to prepare; (2) question-and-answer pages for response to negative questions banks are feeding reporters; (3) talking points so credit unions nationwide can share the same position on BTD; and (4) a model press release that assures credit unions’ readiness for new members as a result. Requests for the materials may be sent in email to commpr@sccul.org.
Bank-weary consumers are aided by a complete listing of all credit unions on the website www.asmarterchoice.org, which has logged nearly 60,000 visitors since September 29—the day that Bank of America announced its new fees. All South Carolina credit unions are listed there, and SCCUL authorizes each credit union for edit authority to ensure accuracy. Contact Brandon Pugh (bpugh@sccul.org) for details.
- CUs have just one week to comply with Registry rule
WASHINGTON (7/22/11)—With the compliance deadline just one week away for a statutory requirement that credit unions and their employees who are "mortgage loan originators" (MLOs) must register on a nationwide licensing system, some credit unions may be contacted by their federal or state regulator just double-checking that they are on top of the requirements, said Kathy Thompson, head of the Credit Union National Association's compliance department.
Effective July 29, the Secure and Fair Enforcement for Mortgage Licensing Act (SAFE Act) requires MLOs to have registered on the Nationwide Mortgage Licensing System & Registry (NMLS), and for MLOs to start putting their unique NMLS-assigned identifier number on appropriate mortgage documents.
As a brief refresher, Thompson reminds that if a credit union offers residential mortgage loans and employs individuals required to be federally registered as mortgage loan originators, the credit union must be registered with NMLS. Residential mortgage loans include first mortgages, second mortgages, home equity lines of credit (HELOCs), refinanced mortgage loans, reverse mortgages and land purchased for the construction of a residence.
A credit union must determine what employees meet the definition of mortgage loan originator, a term that is defined as an individual who takes a residential mortgage loan application and offers or negotiates terms of a residential mortgage loan for compensation or gain.
These MLOs must disclose their identifying number to members applying for a loan. The SAFE Act does provide a de minimus exception from registration if someone who would otherwise be an MLO makes five or fewer mortgage loans during a 12-month period. Effective Aug. 1, consumers will be able to get some information about the loan officer from the NMLS public site based on the MLO identifier number, so it's very important that credit unions that make mortgage loans are ready to go starting in a week.
Credit unions, if you have any compliance questions about the new requirements, CUNA's eGuide provides plenty of resources (login required) and the South Carolina Credit Union League is also ready to help with any implementation issues.
Also, in the latest posting on CUNA's CompBlog, Kathy Thompson speaks frankly about the "potential problem" as – according to the NCUA – several credit unions have yet to go through SAFE registration.