New York regulator issues guidance urging financial institutions and mortgage servicers to work with borrowers

State Issues Covid-19 New York NYDFS

On March 19, the New York Department of Financial Services issued guidance urging its regulated institutions to work with members and communities affected by Covid-19. Efforts include, among other things, waiving fees, providing new loans on favorable terms, increasing ATM cash withdrawal limits, waiving early withdrawal penalties on time deposits, increasing credit card limits, and offering payment accommodations to assist borrowers having payment difficulty.

The issuance followed a similar guidance aimed at regulated and exempt mortgage servicers to work with borrowers adversely impacted by Covid-19. Among other things, servicers should consider (i) forbearing payments for 90 days, (ii) refraining from adverse credit reporting for 90 days; (iii) offering additional time for trial loan modifications; (iv) waiving late fees and online payment fees; and (v) postponing foreclosures and evictions for 90 days.

Each guidance recommends that institutions proactively reach out to customers via app, text, email or otherwise to identify the assistance being offered.