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Financial Services Law Insights and Observations

VA encourages relief for Arkansas borrowers

Federal Issues Department of Veterans Affairs Disaster Relief

Federal Issues

On June 20, the Department of Veterans Affairs (VA) issued Circular 26-19-16, encouraging mortgagees to provide relief for VA borrowers impacted by severe storms and flooding in Arkansas. Among other forms of assistance, the Circular encourages loan holders and servicers to (i) extend forbearance to borrowers in distress because of the severe storms and flooding; (ii) establishes a 90-day moratorium from the disaster date on initiating new foreclosures on affected loans; (iii) waives late charges on affected loans; and (iv) suspends credit reporting. The Circular is effective until July 1, 2020. Mortgage servicers and veteran borrowers are also encouraged to review the VA’s Guidance on Natural Disasters.

Find continuing InfoBytes coverage on disaster relief guidance here.

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