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Washington Department of Financial Institutions urges servicers to support mortgagors
On March 20, the Washington Department of Financial Institutions issued guidance to Washington State regulated and exempt residential mortgage loan servicers regarding support for borrowers impacted by Covid-19. The guidance urges servicers to support adversely impacted mortgagors by, among other things, forbearing mortgage payments for 90 days from their due dates, refraining from reporting late payments to credit rating agencies for 90 days, offering mortgagors an additional 90-day grace period to complete loan modifications, waving late payment fees and online payment fees for 90 days, postponing foreclosures for 90 days, and proactively reaching out to mortgagors to explain the assistance being offered to mortgagors. Such services are also required to ensure that mortgagors do not experience a disruptions of services if the servicer closes its offices. The guidance notes that reasonable and prudent efforts to assist mortgagers will not be subject to examiner criticism.
Federal Reserve Board establishes new program to support flow of credit
On March 20, the Federal Reserve Board expanded its financial support programs of support through creating of the Money Market Mutual Fund Liquidity Facility (MMLF). Under this program, the Federal Reserve Bank of Boston will be able to make loans to eligible financial institutions, to be secured by certain assets purchased from single state and other tax-exempt municipal money market mutual funds. The Federal Reserve Board also provided a term sheet that includes additional detail on the MMLF, and an FAQ page to answer questions relating on the Money Market Mutual Fund Liquidity Facility (MMLF). The FAQs answer questions relating to the purpose and design of the program, borrower information (e.g., borrower eligibility, required borrowing documents), collateral requirements, loan terms (e.g., loan rates, maturity date), and accounting and regulatory implications, among others.
OCC issues bulletin on use of electronic methods for submission of licensing filings
On March 20, the OCC issued Bulletin 2020-20, which strongly recommends the use of electronic methods for submitting licensing filings to the OCC during the Covid-19 pandemic through either through the Central Application Tracking System (CATS) or through the agency’s secure email system. The bulletin notes that submission of a licensing filing in paper form may result in delays in the processing.
NCUA issues letter to federal credit unions regarding annual meeting flexibility
On March 20, the National Credit Union Administration (NCUA) issued a letter to federal credit unions permitting federal credit unions (by adoption by the board of directors of a bylaw) to hold annual meetings, and special member meetings for certain purposes, virtually and without an in-person quorum if certain conditions apply. The letter provides additional guidance to federal credit unions on the ability to revoke the bylaw amendment, the ability to postpone annual meetings, the ability to amend the date of its annual meeting, and the adjournment of a meeting for lack of a quorum.
Fannie Mae issues multifamily investor communication regarding Covid-19
On March 20, Fannie Mae published responses to frequently asked questions related to the impact of Covid-19 on Multifamily MBS and CRT programs. Among other things, the responses clarified that for loans granted forbearance due to Covid-19, Fannie Mae “will continue to advance principal and interest payments on the MBS for at least 120 days and may choose to advance for up to two years before being required to buy the mortgage loan out of the MBS trust.” With respect to the CRT program, Fannie Mae reiterated its commitment to take proactive loss mitigation measures to reduce the likelihood and severity of any losses for any loan that indicates an increased risk of default.
SBA creates website for federal disaster loans
On March 20, the Small Business Administration created a new website for businesses, private nonprofits, homeowners, and renters to apply for disaster loans in connection with Covid-19. The website identifies eligible disaster areas and provides links to apply online and check application status.
Texas regulator issues MLO work from home guidance
On March 20, the Texas Department of Savings and Mortgage Lending issued a notice temporarily suspending any requirement that a physical office be open to the public during posted normal business hours. In addition, the notice provided that licensed MLOs may work from home or another remote location, whether located in Texas or another state, even if the home or remote location is not a licensed branch. However, MLOs are still subject to certain data security requirements and are prohibited from permitting consumers into the MLO’s home.
Illinois Governor issues “stay at home” order
On March 20, Illinois Governor Pritzker issued a statewide “stay at home” order, to take effect as of 5pm on March 21. Financial institutions are considered “essential businesses” and are exempt from the order.
Indiana regulator issues branch closure and MLO work location guidance
On March 20, the Indiana Department of Financial Institutions confirmed that because it does not require licenses for mortgage branch locations or require a licensee to work from a specific branch, there are no restrictions on an individual mortgage loan originator (MLO) from working from a home office.
Montana urges credit unions to work with affected members
On March 20, the Montana Division of Banking and Financial Services issued guidance urging credit unions to work with members and communities affected by Covid-19. Efforts include, among other things, waiving fees, increasing ATM cash withdrawal limits, easing restrictions on cashing checks, easing credit terms for new loans, offering or expanding payday alternative loan programs, increasing credit card limits, and offering payment accommodations to assist members having payment difficulty. The guidance also noted: (i) that “prudent efforts” to modify loan terms would not be subject to examiner criticism, as long as the efforts are documented; (ii) that the Division would work with credit unions to reduce burden when scheduling examinations and inspections, and utilize off-site reviews; (iii) that credit unions should inform the Division of branch or office closures; and (iv) that attendance via electronic communications would constitute in-person attendance at board, committee, and annual meetings.