The National Association of Federal Credit Unions and the Credit Union National Association, the two largest trade groups representing credit unions, are split over a bill that would give bankruptcy judges the power to modify mortgages.NAFCU’s board voted unanimously Tuesday to oppose the revised mortgage bankruptcy provision. The trade group sent a letter to Senate Majority Whip Dick Durbin (D-Ill.) and the entire Senate announcing its opposition on Wednesday.“We believe that a more targeted approach is better suited to address the issue, and are pleased that the discussions with your staff on this matter have proceeded along such lines,— NAFCU President Fred Becker wrote.However, NAFCU said it opposes the compromise legislation because information regarding work-out plans for subordinate liens as well as how the new legislation would affect existing private mortgage insurance contracts has not been made available.CUNA President and CEO Dan Mica rebutted NAFCU’s decision to pull out of the negotiations.“From the beginning of the discussions with the Senate, all opposed the House version of the bill, and CUNA engaged in good faith negotiations aimed at good public policy and addressing concerns of our industry,— Mica said in a statement. “CUNA will continue to work with Sen. Durbin and Senate leaders to develop a legislative approach that limits negative impact on credit unions.—Additionally, CUNA said that it is close to an “acceptable resolution— regarding the two issues raised by NAFCU in its letter.CUNA is expected to support the agreement, according to several financial services lobbyists, but so far, the trade group has not publicly come out in favor of the legislation.“This is not the time to merely walk away; there is too much at stake for credit unions,— Mica added.Durbin’s staff worked over the recess to forge a compromise with banks and credit unions.Representatives from CUNA, NAFCU, the Independent Community Bankers of America, Wells Fargo, Bank of America and JP Morgan Chase & Co. met with Senate aides over recess.“This doesn’t in any way change the dynamic,—a Senate aide said of NAFCU pulling out of the negotiations. “It shows NAFCU is more interested in creating friction with CUNA over who is going to be the preeminent representative for credit unions,— he added.This isn’t the first time there has been a split in the financial services industry over cram-down legislation.Although the American Bankers Association has not been participating in the negotiations, four of its largest members, JP Morgan Chase, Citigroup, Bank of America and Wells Fargo have been working on a compromise.