NCUA Region V examiners are uncovering loan servicing issues at credit unions.
According to the June 2013 NCUA Report, "examiners have noted problems with interest accrual calculation, how late fees are applied and how payments are applied. Misapplication of payments may violate contracts with not only the borrower,
but with third-parties, such as the secondary mortgage market, or participants in a commercial loan."
NCUA recommended that "credit unions review their own systems to ensure that all of their loan servicing practices and procedures are correct and proper."
Read the NCUA Report (story can be found on pages 6 and 7).
All pretty basic stuff. If this is a problem, then it's probably been one for a long time, since nothing has changed. Wonder why NCUA is just catching it? Maybe someone finally explained to them how payments are processed.
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