WASHINGTON - In light of its recent decision to stop selling single-premium credit life insurance policies, Citigroup Inc. has now withdrawn its objections to a Federal Reserve Board proposal to include the cost of such policies when determining the Home Ownership and Equity Protection Act's points and fees trigger.
"Our shift in position had a great deal to do with our conversations last week," Robert B. Willumstad, Citi's consumer chief, wrote in a letter Monday to Senate Banking Committee Chairman Paul S. Sarbanes, D-Md.
The move came just days before the committee is scheduled to convene its predatory lending hearings Thursday.
"Further, given that the Federal Reserve's proposal does not include monthly pay credit insurance in the points and fees trigger - a provision you support - we are comfortable that customers will continue to have appropriate access to credit insurance once the proposal is enacted," Mr. Willumstad wrote.
Under the Fed proposal, more mortgages would be subject to the Home Ownership and Equity Protection Act of 1994's price limits and disclosure requirements, which go beyond those required under the Truth-in-Lending Act.