Credit unions express concerns about 'buy-back' provisions

If the FHFA, which oversees Fannie and Freddie, should require the provision, NAFCU is concerned that there will be at least two highly undesirable results.

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He argues that the policies would disproportionately affect credit unions because they don't have the volume of loans or enough capital, and it would also reduce the number of available products on the market. 

If policies requiring buy-back provisions are adopted for those loans that are not qualified mortgages, as defined last week by the Consumer Financial Protection Bureau, "the market can only be expected to further contract to absorb very few mortgages outside that QM realm," Berger wrote.