Illinois Department of Financial and Professional Regulation issues guidance to mortgage servicers

State Issues Illinois Covid-19 Mortgage Servicing Mortgages Forbearance Credit Rating Agencies Loss Mitigation Foreclosure

On March 30, the Illinois Department of Financial Regulation, Division of Banking and Division of Financial Institutions (Department), issued guidance to Illinois-licensed mortgage servicers and exempt mortgage servicers urging support for borrowers impacted by Covid-19. The Department urges all servicers of nonconforming and private mortgages to implement policies at least as helpful to borrowers as those offered for conforming loans, including, among others: (i) forbearing mortgage payments for at least 90 days without incurring additional interest or fees; (ii) refraining from reporting late payments to credit rating agencies and, when payments are deferred or modified, coding those payments as deferred with the applicable disaster order; (iii) offering loss mitigation options to borrowers; and (iv) waiving late payment fees and online payments fees; and (v) postponing foreclosures and evictions for at least 90 days. Prudent actions taken during this period will be considered to be consistent with safe and sound banking practices and will not be subject to examiner criticism.