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FTC provides advice to mortgage borrowers impacted by Covid-19
On April 14, the FTC released guidance entitled “Coronavirus and your mortgage” to provide financial information to consumers affected by the Covid-19 pandemic. The guidance points out that many mortgage borrowers facing Covid-19-related financial hardships may benefit from CARES Act protections. Starting on March 18, borrowers with federally-backed mortgages cannot have foreclosure proceedings instituted against them for 60 days. The CARES Act also provides borrowers the right to request forbearance for up to 180 days in order to temporarily freeze or lower mortgage payments. After the forbearance period ends, borrowers may request an additional forbearance for up to 180 days if they are still having trouble making mortgage payments as a result Covid-19. The FTC’s guidance provides contact information for the GSEs so borrowers can determine if their mortgages are federally backed. In addition, the guidance encourages all borrowers to contact their servicers for available payment options and assistance. The FTC suggests that approved housing counselors may also help, and can be found on the Department of Housing and Urban Development’s website here, while the Homeownership Preservation Foundation may be able to assist borrowers in making payment arrangements with their mortgage servicers. (See website here.) The FTC advises borrowers to check state government websites for state-specific information, though the agency warns borrowers to be wary of mortgage relief scams. Finally, the guidance reminds borrowers never to pay up-front for help with their mortgage payments and provides additional links for more detailed information.
Wisconsin DFI issues emergency guidance on debt collection
On April 13, the Wisconsin Department of Financial Institutions issued guidance on debt collection practices that are prohibited during the Covid-19 crisis. Among them are repeated telephone calls and unsolicited threats to sue. The guidance warns that debt collectors that fail to respect hardships arising from the Covid-19 pandemic “should expect to be judged harshly.”
California insurance commissioner issues bulletin requiring premium refunds, credits, and reductions
On April 13, the California insurance commissioner issued Bulletin 2020-3 to property and casualty insurers regarding premium refunds, credits, and reductions in response to Covid-19. In light of the reductions in risk across certain lines of insurance as a result of reduced activity during Covid-19, insurers are required to make an initial premium refund for the months of March and April to all adversely impacted California policyholders for certain lines of insurance as soon as practicable but within 120 days from April 13. The bulletin contains additional guidance regarding how to refund the premiums, whether approval is required from the Department of Insurance for certain changes in premiums, and reporting requirements for actions taken.
Massachusetts attorney general: CARES Act payments are exempt from seizure
On April 13, the Massachusetts Office of the Attorney General notified creditors and debt collectors that, in its view, stimulus payments made under the CARES Act are exempt from garnishment or attachment by creditors under Massachusetts law, and remain exempt regardless of how the funds are deposited or held after receipt. Any act, or threat to act, to garnish, attach, or otherwise seize the funds will be a violation of the attorney general’s regulations governing debt collection.
Pennsylvania Insurance Department issues guidance for insurance companies
On April 13, the Pennsylvania Insurance Department issued Notice #2020-10 addressing obligations of domestic insurance companies during the Covid-19 pandemic. The notice details (i) extensions of 30 or 60 days for various regulatory filing deadlines; (ii) waivers of the hard copy, original signature, notarization and other in-person related filing requirements; and (iii) adjustments for remote examinations.
Pennsylvania Insurance Department encourages premium finance companies to offer grace periods
On April 13, the Pennsylvania Insurance Department issued Notice #2020-11 communicating its expectations for premium finance companies during the Covid-19 pandemic. Such companies, and the insurance carriers they work with, are encouraged to extend grace periods for loan payments, be flexible with regard to determinations of default, and waive delinquency or other late payment charges.
Ohio attorney general: CARES Act payments exempt from garnishment under state law
On April 13, Ohio Attorney General Dave Yost issued a notice that Ohio law exempts CARES Act payments from garnishment, attachment, and execution. Yost noted that, in the event of an execution against a CARES Act payment, his office may intervene to enforce Ohio law.
New York Department of Financial Services issues Covid-19 cybersecurity guidance
On April 13, the New York Department of Financial Services issued guidance on cybersecurity awareness during the Covid-19 pandemic. The guidance identifies three areas of heightened risk: (i) remote working, including the risks associated with less secure internet connections, expanded use of less secure personal devices, increased use of video and audio-conferencing applications, and use of unauthorized personal accounts and applications to transmit non-public information; (ii) increased online phishing and fraud attempts; and (iii) increased risk to third party vendors. In accordance with the DFS’s cybersecurity regulation, all regulated entities are instructed to assess these risks and address them appropriately.
Maryland insurance administration calls on commercial insurers to work with consumers
On April 13, the Maryland insurance administration commissioner issued a bulletin to all property and casualty insurers regarding commercial insurance in light of the Covid-19 crisis. The bulletin called on insurers to cooperate with impacted insureds to revise policies utilizing estimated payroll and revenue; waive or reduce short-rate cancellation penalties; rely on pre-crisis data when assessing credit-worthiness for underwriting; and refrain from penalizing insureds that have inquired or filed business interruption claims that have not involved claim payments.
Treasury announces that over 80 million will receive economic impact payments
On April 13, the U.S. Department of the Treasury announced that it expects over 80 million Americans will receive Economic Impact Payments within the next two weeks, with tens of millions receiving direct deposit payments into their bank accounts by April 15. Additionally, the IRS will separately launch an online application called “Get My Payment” that allows taxpayers who filed in 2018 and 2019 but did not provide bank account information to submit direct deposit information for purposes of expediting their payment.