New Interagency Guidance Describes Credit Risk Considerations for Lending to Non-Work Authorized Borrowers

Posted by Erin Hall on July 14, 2026

Federal regulators, including the NCUA, issued new interagency guidance describing how credit unions and other supervised financial institutions may consider existing safe-and-sound credit risk management practices when lending to borrowers who are not legally authorized to work in the United States. The guidance, issued by the Office of the Comptroller of the Currency, Federal Deposit Insurance Corporation, and the NCUA, does not create new legal requirements and does not carry the force of law in the same way that regulations do. It also does not require credit unions to change their lending policies or procedures. Rather, it outlines the agencies’ views on credit risk considerations related to ability to repay, seasonal or potentially interrupted employment, collecting on international debt obligations, collateral recovery, and overall portfolio risk. The guidance is in accordance with Executive Order 14406, “Restoring Integrity to America’s Financial System,”

What Credit Unions Should Know

The agencies emphasized that lending decisions should continue to be grounded in a borrower’s willingness and capacity to repay. For borrowers whose income depends on employment that may be seasonal, potentially interrupted, or not legally authorized, the guidance states that institutions may consider whether that income is current, verifiable, stable, and likely to continue over the life of the loan. The guidance identifies several areas where credit risk may arise, including interruptions in employment, inability to become lawfully reemployed, removal from the United States, challenges locating and recovering collateral, and the practical considerations associated with collecting on debt obligations internationally.

The guidance also ties closely to the Consumer Financial Protection Bureau’s June 8, 2026 statement on ability-to-repay and immigration status. That statement reminded creditors of their obligations under the Truth in Lending Act and Regulation Z, including the requirement to make a reasonable and good-faith determination of a consumer’s ability to repay certain mortgage and open-end credit obligations. It also highlighted that, under the Equal Credit Opportunity Act and Regulation B, creditors may consider immigration status when it is necessary to determine their rights and remedies regarding repayment.

Operational Considerations

The guidance does not direct credit unions to revise lending policies or procedures. Lending, compliance, and risk teams may nevertheless find it useful as a reference point when evaluating how current underwriting standards address income verification, employment continuity, repayment capacity, collateral recovery, credit classification, allowance considerations, international collection issues, and portfolio concentrations that could be affected by workforce disruptions or changes in immigration enforcement.

Credit unions should also keep consumer compliance obligations front and center. Any consideration of immigration or work authorization status should be handled consistently with applicable law, including fair lending requirements.

Bottom Line

This guidance is best understood as the agencies’ explanation of credit risk considerations rather than a binding regulatory mandate. It does not impose new requirements or require changes to lending policies or procedures. Instead, it describes how issues such as ability to repay, seasonal or interrupted employment, and the ability to collect on international debt obligations may be relevant to a safe-and-sound, well-documented, and legally compliant lending process.

GoWest is here to serve as a resource as credit unions evaluate the guidance and consider how it may fit within their existing lending, compliance, and risk management frameworks. We understand that financial inclusion is an important part of how credit unions operate and who they serve, and we can help provide resources or guidance where and when appropriate.

Posted in Advocacy on the Move, Regulatory Advocacy.