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On October 1, 2020, the U.S. Department of Housing and Urban Development issued Mortgagee Letter 20-33, which extends interim procedures regarding site access issues related to Section 232 mortgage insurance applications during the Covid-19 pandemic (previously covered here and here). The guidance provides temporary modifications pertaining to third-party site inspections for Section 232 FHA-insured healthcare facilities effective through December 31, 2020. The letter also provides guidance on other aspects relating to Section 232 properties, including regarding lender underwriter site visits, appraisals, and inspections on new construction, among other things.
Massachusetts temporarily waives requirements for certain residential property inspections prior to sale
On March 20, the Massachusetts governor ordered that the inspections for smoke alarms and carbon monoxide detectors required by state law in connection with residential property sales may be deferred, provided that (1) the buyer agrees to take responsibility for equipping the property with the requisite alarms and detectors; and (2) the inspection is conducted within 90 days after the state of emergency for the Covid-19 outbreak is lifted.
On May 14, the Maryland Attorney General announced a settlement with a mortgage loan servicer to resolve allegations that it charged homeowners illegal inspection fees. According to the announcement, the servicer allegedly charged borrowers for property inspections that were done when the borrower was in default on their payments, in violation of a Maryland law, which prohibits passing on such inspection costs. The mortgage servicer ceased the practice in 2014 for forward mortgages and in 2016 for reverse mortgages, according to the Attorney General’s office. The settlement requires the mortgage servicer to (i) refrain from engaging in the same practice in the future; (ii) complete the return of almost $1 million in collected inspection fees; and (iii) pay nearly $500,000 in penalties and costs.
- Jonice Gray Tucker to discuss “Getting your company ready: Managing fair lending for IMBs” at the Mortgage Bankers Association Independent Mortgage Bankers Conference
- Jonice Gray Tucker to discuss “Be Your Compliance Best in 2022” at the California Mortgage Bankers Association webinar
- Lauren R. Randell to discuss “Significant legal developments in the Northeast” at the 37th Annual National Institute on White Collar Crime
- Jonice Gray Tucker to discuss “Small business & regulation: How fair lending has evolved & where it is heading?” at the Consumer Bankers Association Live program
- Jonice Gray Tucker and Kari Hall to discuss “Equity, equality, regulation and enforcement – The evolving regulatory landscape of fair lending, redlining, and UDAAP” at the ABA Business Law Committee Hybrid Spring Meeting