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  • OCC announces FEMA's flood insurance payment deadline extension

    Federal Issues

    On April 15, the OCC released a statement addressing the Federal Emergency Management Agency’s (FEMA) extension to the grace period for renewing flood insurance policies from 30 days to 120 days due to the Covid-19 pandemic. FEMA’s guidance in Bulletin W-20002 relates to National Flood Insurance Program policies with expiration dates from February 13, 2020 to June 15, 2020, and states that coverage will not lapse if the policy premium is paid prior to the end of the extended grace period. FEMA’s bulletin indicates that the payment grace period was extended “to allow additional time for policyholders who may be struggling financially during this unprecedented time to pay insurance premiums by ensuring that their policies are not canceled for nonpayment of premium due to circumstances beyond their control.” Likewise, the OCC statement “recognizes the serious impact the COVID-19 emergency may have on consumers” and conveys that it will not take enforcement or supervisory action against banks for “reasonable delays in complying with” the OCC’s force placement of flood insurance regulations. The OCC reminds banks that if flood insurance is force placed during the extended grace period, the banks must refund the cost of the overlapping coverage to the borrower.

    Federal Issues Agency Rule-Making & Guidance OCC FEMA National Flood Insurance Program Flood Insurance Force-placed Insurance Covid-19

  • Freddie Mac issues selling guidance related to Covid-19

    Federal Issues

    On April 14, Freddie Mac issued Guide Bulletin 2020-11 to Freddie Mac sellers setting forth selling guidance related to Covid-19. The bulletin contains guidance relating to property eligibility, temporary flexibility with respect to the seller’s post-funding quality control review regarding targeted sampling of loans that become 60 days or more past due in the first six months, and revisions to requirements regarding maximum contracts and aggregate cash commitment volume for certain contracts. The bulletin also updates the list of permitted states for remote online notarization and provides additional clarifications regarding notarizations.

    Federal Issues Covid-19 Freddie Mac Mortgages

  • Fannie Mae updates appraisal guidance on impact of Covid-19

    Federal Issues

    On April 14, Fannie Mae updated certain elements of Lender Letter 2020-04 regarding the impact of Covid-19 on appraisals. The letter applies to all Fannie Mae Single-Family Sellers. Fannie Mae has updated its guidance regarding flexibilities for condominium project reviews, virtual inspections for appraisals and renovation loans, new construction loans, HomeStyle renovation loans in forbearance, use of lender variances and temporary appraisal flexibilities, and additional form instructions for appraisals.

    Federal Issues Covid-19 Fannie Mae Mortgages Forbearance CARES Act

  • HUD issues guidance on HECM assignment claims during Covid-19

    Federal Issues

    On April 14, HUD issued Mortgagee Letter 2020-12 to inform mortgagees of alternative documentation options and delayed documentation delivery deadlines for submitting Home Equity Conversion Mortgage (HECM) claims for during the Covid-19 related closures. In particular, alternative documentation is permitted to document that taxes are current, HOA and condominium dues are not delinquent, and the borrower will occupy the property as a principal residence. The guidance addresses delayed delivery of original notes, mortgages, and assignments to the Secretary. It also reminds mortgagees of the required repurchase of the HECM if the HECM did not meet all criteria at the time of assignment claim payment. 

    Federal Issues Covid-19 HUD HECM HOA Mortgages

  • Washington DFI issues guidance to investment advisers on CARES Act loans

    State Issues

    The Washington Department of Financial Institutions issued guidance for state-registered investment advisers regarding CARES Act loans. Should a firm obtain a CARES Act loan, DFI will not consider it a net worth deficiency if certain criteria outlined in the guidance are met. However, if it is determined that some or all of the loan will not be forgiven, the firm must immediately notify the DFI and reclassify the loan as a liability.

    State Issues Covid-19 Washington CARES Act Investment Adviser

  • SEC issues a statement on the importance of disclosures to investment company investors

    Federal Issues

    On April 14, the SEC Division of Investment Management issued a statement on the importance of delivering timely and material information to investors of investment companies. Investment company issuers are reminded of their statutory obligations to update the information in their prospectuses, including the required underlying certified financial statements. Investment companies also are encouraged to consider the impact of Covid-19-related events when drafting their disclosures, including risk disclosures. The statement also includes the SEC’s expectations regarding timely delivery of disclosures to fund investors.

    Federal Issues Covid-19 SEC

  • Illinois executive order prohibits service of garnishment, wage deduction summonses

    State Issues

    On April 14, the Illinois governor issued an executive order in response to Covid-19, suspending provisions of Illinois law that permit the service of a garnishment summons, a wage deduction summons, or a citation to discover assets on consumers. The suspension does not apply to domestic support obligations and does not relieve debtors of lability.

    State Issues Covid-19 Illinois

  • Illinois regulator issues Covid-19 best practices for consumer credit licensees

    State Issues

    On April 14, the Illinois Department of Financial and Professional Regulation issued guidance for consumer credit licensees, noting that it expects them to work with consumers during the crisis and be flexible with repayment of debt. The department recommended following a number of best practices, including increasing communication with consumers, waiving late charges and insufficient fund fees, suspending debt collection efforts, recommending that the creditor utilize the natural disaster code when reporting a consumer’s credit wherever permissible, and ensuring sufficient staffing of customer service phone lines, among other things.

    State Issues Covid-19 Illinois Consumer Credit Licensing Debt Collection

  • New Mexico regulator halts repossessions during pandemic

    State Issues

    On April 14, the New Mexico Public Regulation Commission provided notice that towing services for purpose of automobile repossessions are deemed non-essential by the governor. The notice effectively bans repossession for the duration of the Covid-19 emergency.

    State Issues Covid-19 New Mexico Auto Finance

  • New Jersey passes legislation permitting remote notarization during state of emergency

    State Issues

    On April 14, New Jersey passed legislation permitting remote notarization using communication technology for the duration of the public health emergency and state of emergency, provided certain requirements stipulated in the legislation are met.

    State Issues Covid-19 New Jersey Notary Fintech

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