Following passage of the Dodd-Frank relief package, the board of the National Credit Union Administration has approved a final rule to amend its definition of a member business loan in order to comply with the new law.

President Donald Trump signed the regulatory relief package into law May 24. It contained language that amended the Federal Credit Union Act to allow credit unions to treat loans for one- to four-unit, non-owner-occupied dwellings that qualify for the member business loan exemption as residential loans with lower interest rates – similar to how banks make these loans to small businesses.

Those loans will no longer count toward the aggregate member business loan cap imposed on federally-insured credit unions, which was 12.25 percent of total assets.

“This is a great change for credit unions, and we applaud NCUA Chairman [Mark] McWatters and Board Member [Rick] Metsger for acting quickly following the passage of S. 2155,” NAFCU President and CEO Dan Berger said in a statement. “Credit unions will receive some relief under member business lending requirements for the first time in almost 20 years, and now, thanks to the NCUA diligently making its language consistent with the new law, credit unions can immediately make loans secured by a one- to four-family dwelling to benefit their members.”