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  • Federal and state financial regulatory agencies issue interagency disaster relief guidance for institutions affected by Hurricane Florence

    Federal Issues

    On September 14, the OCC, Federal Reserve Board, FDIC, NCUA, and the Conference of State Bank Supervisors (collectively, the “agencies”) issued a joint statement providing guidance to financial institutions impacted by Hurricane Florence. The agencies encouraged lenders to work with borrowers in impacted communities and to consider, among other things, (i) whether to modify loans based on the facts and circumstances, and (ii) requesting to operate temporary bank facilities if faced with operational difficulties. On the same day, the FDIC also provided guidance for depository institutions assisting affected customers (see FIL-48-2018), which may include “waiving fees, increasing ATM cash limits, easing credit card limits, allowing loan customers to defer or skip payments, and delaying the submission of delinquency notices to credit bureaus.” Furthermore, the FDIC encouraged depository institutions to use Bank Secrecy Act-permitted “non-documentary verification methods” for customers unable to provide standard identification documents.

    The agencies also reminded institutions to contact their appropriate federal and/or state regulator should they experience disaster-related difficulties when complying with publishing and regulatory reporting requirements, and further noted that institutions may receive favorable Community Reinvestment Act consideration for community development loans, investments, and services in support of disaster recovery. The statement also provides links to previously issued examiner guidance for institutions affected by major disasters.

    Find continuing InfoBytes coverage on disaster relief here.

    Federal Issues OCC Federal Reserve FDIC NCUA CSBS Consumer Finance Mortgages Bank Secrecy Act Disaster Relief

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  • OCC provides guidance to institutions affected by Hurricane Florence

    Federal Issues

    On September 11, the OCC issued a proclamation permitting OCC-regulated institutions to close their offices affected by Hurricane Florence in the Southeast and Mid-Atlantic. The OCC noted that only institutions directly impacted by potentially unsafe conditions should close, and that those offices should attempt to reopen as soon as possible to serve their customers’ banking needs. OCC Bulletin 2012-28 provides further guidance on natural disasters and other emergency conditions.

    Find continuing InfoBytes coverage on disaster relief here.

    Federal Issues OCC Disaster Relief

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  • Agencies issue guidance to institutions affected by storms in Gulf Coast and Hurricane Lane in Hawaii

    Federal Issues

    On September 5, the OCC issued a proclamation permitting OCC-regulated institutions to close their offices affected by Tropical Storm Gordon in the Gulf Coast Region. OCC Bulletin 2012-28 provides further guidance on natural disasters and other emergency conditions.

    On August 30, the Department of Veterans Affairs issued Circular 26-18-17, requesting relief for homeowners impacted by Hurricane Lane in Hawaii. Among other things, the Circular (i) encourages loan holders to extend forbearance to borrowers in distress because of the storms; (ii) requests that loan holders establish a 90-day moratorium on initiating new foreclosures on loans affected by the major disaster; and (iii) waives late charges on affected loans. The Circular is effective until October 1, 2019.

    Find continuing InfoBytes coverage on disaster relief here.

    Federal Issues OCC Department of Veterans Affairs Disaster Relief Mortgages Foreclosure Forbearance

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  • OCC provides guidance to institutions affected by Hurricane Lane; Fannie Mae, Freddie Mac offer forbearance relief to impacted homeowners

    Federal Issues

    On August 24, the OCC issued a proclamation permitting OCC-regulated institutions to close their offices affected by Hurricane Lane in Hawaii. OCC Bulletin 2012-28 provides further guidance on natural disasters and other emergency conditions.

    On August 23, Fannie Mae also reminded servicers of mortgage assistance options for homeowners impacted by the hurricane. Specifically, qualifying homeowners are eligible to stop making mortgage payments for up to 12 months, during which time late fees will not be incurred nor delinquencies reported to the credit bureaus. Additionally, servicers may immediately suspend or reduce mortgage payments for up to 90 days without any contact with homeowners believed to have been affected by the hurricane. Further, foreclosures and other legal proceedings must be suspended for impacted homeowners.

    The same day, Freddie Mac confirmed its disaster relief options are available to borrowers with homes or places of employment impacted by the hurricane, emphasizing that borrowers in FEMA-declared disaster areas have access to federal individual assistance programs. The relief suspends foreclosures by providing forbearance for up to 12 months. Penalties and late fees will also be waived, and servicers should not report forbearance or delinquencies caused by the disaster to credit bureaus. Moreover, Freddie Mac also reminded servicers to consider borrowers who live and work in affected areas but have homes outside the eligible disaster area for standard relief policies.

    Find continuing InfoBytes coverage on disaster relief here.

    Federal Issues OCC Disaster Relief

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  • FHA updates loss mitigation options for mortgages in certain areas of Puerto Rico and the U.S. Virgin Islands

    Federal Issues

    On August 15, the Federal Housing Administration (FHA) released Mortgagee Letter 2018-05 (ML 2018-05), which updates loss mitigation options for certain FHA-insured mortgages located in Puerto Rico or Virgin Islands. The properties must be located in Presidentially-Declared Major Disaster Areas (PDMDAs) as a result of Hurricane Maria. In adition, FHA is also instituting a 30-day foreclosure moratorium on certain properties located in Puerto Rico or the Virgin Islands that FEMA has declared to be eligible for individual assistance. (As previously covered by InfoBytes, ML 2018-03 had extended an existing moratorium through August 16.) Additionally, in order to reduce foreclosures and minimize losses to the Insurance Fund, ML 2018-05 provides updated loss mitigation options “designed to provide greater alternatives to foreclosure for mortgagees to use with borrowers in the designated PDMDAs.” The new options supersede the previous ones offered in ML 2018-01 and rearrange the loss mitigation waterfall in order to provide expedited permanent loss mitigation solutions by considering “Disaster Standalone Partial Claims” earlier. This option would allow borrowers, among other things, to maintain their pre-disaster monthly payment of principle and interest and does not change interest rate and term of the mortgage. These loss mitigation options must be implemented by September 15 and expire May 1, 2019. The foreclosure mortgage moratorium is effective immediately and applies to the initiation of foreclosures and foreclosures already in process.

    Federal Issues FHA HUD Disaster Relief Loss Mitigation Mortgages Foreclosure

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  • OCC, FDIC provide guidance to institutions affected by California wildfires

    Federal Issues

    On August 9, the OCC issued a statement permitting OCC-regulated institutions to close their offices affected by wildfires in California. OCC Bulletin 2012-28 provides further guidance on natural disasters and other emergency conditions. (See previous InfoBytes coverage here). On the same day, the FDIC also provided guidance related to California wildfires in FIL-41-2018. Among other things, the FDIC is encouraging institutions to consider extending repayment terms and restructuring existing loans that may be affected.

    Federal Issues OCC FDIC Disaster Relief

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  • Fannie Mae, Freddie Mac issue forbearance relief to homeowners affected by California wildfires

    Federal Issues

    On August 8, Freddie Mac extended its disaster relief options to homeowners affected by ongoing California wildfires who have access to federal individual assistance programs in FEMA-declared disaster areas. The relief suspends foreclosures by providing forbearance for up to 12 months. Penalties and late fees will also be waived. Freddie Mac also reminded servicers to consider borrowers who work in eligible disaster areas but have homes outside the affected area for standard relief policies. Moreover, servicers may leverage Freddie Mac forbearance programs to provide immediate mortgage relief to those affected by the wildfires in areas where FEMA has not made individual assistance available.

    On August 7, Fannie Mae issued a notice to mortgage servicers reminding them that homeowners impacted by the California wildfires are eligible to stop making mortgage payments for up to 12 months, during which time late fees will not be incurred nor delinquencies reported to the credit bureaus. Furthermore, servicers may immediately suspend or reduce mortgage payments for up to 90 days without any contact with homeowners believed to have been affected by the wildfires. Additionally, foreclosures and other legal proceedings must be suspended for impacted homeowners.

    Find continuing InfoBytes coverage on disaster relief here.

    Federal Issues Fannie Mae Mortgages Mortgage Servicing Disaster Relief

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  • Fannie Mae and Freddie Mac issue disaster relief policy reminders and updates

    Federal Issues

    On July 18, Fannie Mae, in Lender Letter LL-2018-04, and Freddie Mac, in an industry letter released the same day, reminded servicers of requirements that continue to be in effect for servicing mortgages impacted by eligible disasters. Specifically, Fannie Mae provides information on (i) reimbursements related to insured loss repair inspection costs; (ii) disaster-impacted inspections; (iii) the Extend Modification for Disaster Relief policy—developed in conjunction with Freddie Mac for post-disaster forbearance mortgage loan modifications; and (iv) the disbursement of hazard loss draft proceeds. Freddie Mac also reminds servicers of property inspection reimbursement requirements and changes to insurance loss settlement distributions.

    Find continuing InfoBytes coverage on disaster relief here.

    Federal Issues Fannie Mae Freddie Mac Disaster Relief Mortgage Servicing

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  • Fannie Mae updates borrower-initiated mortgage insurance termination requirements

    Federal Issues

    On July 18, Fannie Mae released Lender Letter LL-2018-03 (Letter) to provide updates to requirements for single-family servicers related to borrower-initiated conventional mortgage insurance (MI) termination requests. The Letter covers requirements for borrower-initiated MI terminations and outlines various processes for verifying current property values. Among other things, the Letter also incorporates into the Servicing Guide changes previously announced in LL-2017-09 (see previous InfoBytes coverage here), which allows for temporary forbearance mortgage loan modification for servicers with mortgage loans affected by recent disasters. Fannie Mae encourages servicers to implement the new requirements on January 1, 2019, but will not require them to do so until March 1, 2019, unless otherwise noted.

    Federal Issues Fannie Mae Mortgage Insurance Servicing Guide Disaster Relief

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  • FDIC provides relief for storm-hit areas of Texas

    Federal Issues

    On July 3, the FDIC issued Financial Institution Letter FIL-37-2018 to provide regulatory relief to financial institutions and facilitate recovery in areas of Texas affected by severe storms and flooding from June 19 through the present. The FDIC is encouraging institutions to consider, among other things, extending repayment terms and restructuring existing loans that may be affected by the natural disasters. Additionally, the FDIC notes that institutions may receive favorable Community Reinvestment Act (CRA) consideration for community development loans, investments, and services in support of disaster recovery.

    Federal Issues FDIC Disaster Relief Mortgages

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