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On January 12, HUD announced disaster assistance for certain areas in Missouri impacted by severe storms, straight-line winds, and tornadoes in December 2021. The disaster assistance supplements state, tribal, and local recovery efforts in specific counties, and provides foreclosure relief and other assistance to affected homeowners following President Biden’s major disaster declaration on January 11. According to the announcement, HUD is providing an automatic 90-day moratorium on foreclosures of FHA-insured home mortgages for covered properties and is making FHA insurance available to victims whose homes were destroyed or severely damaged, such that “reconstruction or replacement is necessary.” HUD’s Section 203(k) loan program allows individuals who have lost homes to finance the purchase of a house or refinance an existing house along with the costs of repair, through a single mortgage. The program also allows homeowners with damaged property to finance the rehabilitation of existing single-family homes. HUD also announced it is allowing applications for administrative flexibility waivers for Community Planning and Development Grantees and public housing authorities. Recently, HUD announced it will provide the same foreclosure relief and assistance to Alabama, Arkansas, Kansas, and Washington state homeowners affected by severe storms, flooding, tornados, and wildfires in those states. (See press releases here, here, here, and here).
On December 23, the FDIC issued FIL-82-2021 to provide regulatory relief to financial institutions and help facilitate recovery in areas of Alabama affected by severe storms and flooding. The FDIC acknowledged the unusual circumstances faced by institutions and their customers affected by the weather and suggested that institutions work with impacted borrowers to, among other things, (i) extend repayment terms; (ii) restructure existing loans; or (iii) ease terms for new loans to those affected by the severe weather, provided the measures are done “in a manner consistent with sound banking practices.” Additionally, the FDIC noted that institutions “may receive favorable Community Reinvestment Act consideration for community development loans, investments, and services in support of disaster recovery.” The FDIC will also consider regulatory relief from certain filing and publishing requirements.
On December 3, the Alternative Reference Rates Committee (ARRC) under the New York and Alabama LIBOR Relevant Recommending Body, released a statement recommending forms of the Secured Overnight Financing Rate (SOFR) and associated spread adjustments to replace references to 1-week and 2-month USD LIBOR in certain contracts affected by New York and Alabama state LIBOR legislation. The statement comes “with just one month until no new LIBOR and the cessation of these two USD LIBOR tenors,” noting that these recommendations are “important for the legacy contracts that rely on those tenors.” Under the states’ LIBOR legislation, ARRC serves as the “Relevant Recommending Body,” while SOFR is the recommended rate and alternative to USD LIBOR.
As previously covered by InfoBytes, ARRC announced its recommendation of CME Group’s forward-looking SOFR term rates, following the completion of key changes in trading conventions on July 26 under the SOFR First initiative. According to the recently released statement, ARRC recommends applying SOFR only to the narrow set of LIBOR-based contracts that are affected by the states’ LIBOR legislation, which are generally contracts with no fallbacks or fallbacks that reference LIBOR. For contracts with fallbacks that give a party discretion to decide on a replacement rate, the state laws also provide a safe harbor if that party chooses the SOFR-based rate and conforming changes recommended by ARRC. ARRC also published a set of frequently asked questions regarding the application of New York state law.
On April 30, the FDIC issued FIL-31-2021 and FIL-32-2021 to provide regulatory relief to financial institutions and help facilitate recovery in areas of Kentucky and Alabama affected by severe storms. The FDIC acknowledged the unusual circumstances faced by institutions affected by the storms and suggested that institutions work with impacted borrowers to, among other things, (i) extend repayment terms; (ii) restructure existing loans; or (iii) ease terms for new loans to those affected by the severe weather, provided the measures are done “in a manner consistent with sound banking practices.” Additionally, the FDIC noted that institutions “may receive favorable Community Reinvestment Act consideration for community development loans, investments, and services in support of disaster recovery.” The FDIC will also consider regulatory relief from certain filing and publishing requirements.
On May 8, the Alabama governor issued a Ninth Supplemental Proclamation amending an earlier proclamation providing relief from residential evictions and foreclosures, which we previously covered here. The earlier proclamation is amended to specify that the protection against evictions applies only to evictions based on nonpayment. The proclamation also extends the state of emergency issued on March 13, 2020, for an additional sixty days, unless sooner terminated. The proclamation will remain in effect for the duration of the public health emergency unless rescinded or extended by another proclamation.
The Alabama Securities Commission has extended a temporary order providing relief to registrants affected by Covid-19 to May 15, 2020, in light of the Alabama governor’s issuance of the April 28, 2020 “Safer at Home” order. The temporary order was originally covered here.
On April 29, the Alabama State Banking Department issued a memorandum encouraging licensees to work proactively with customers and to keep the department apprised of such efforts. Licensees are also reminded to work with customers to make sure they are aware of the potential for scams during the COVID-19 pandemic. The department should be notified of any suspicious lending-related activity.
The supervisor for the Alabama State Banking Department Bureau of Loans issued a statement to licensees extending the annual report, mortgage call report, and financial statement deadlines to July 15.
On April 3, the Alabama governor issued a proclamation announcing temporary relief from residential evictions and foreclosures. All state, county, and local law enforcement officers are directed to cease enforcement of any order that would result in the displacement of a person from their residence. The proclamation does not relieve individuals of any obligation to pay rent, make mortgage payments, or comply with any obligation that an individual may have under a rental agreement or mortgage. Any law that conflicts with the proclamation is suspended for the duration of the state of emergency for Covid-19.
On March 26, the Alabama governor issued a proclamation permitting remote notarization through videoconferencing, provided that certain requirements are met. A subsequent proclamation, issued on April 2, extended permission for remote notarization to unsupervised, non-attorney notaries and added a record-keeping requirement for such notarizations. Additionally, the proclamation permits remote shareholder meetings pursuant to guidelines and procedures adopted by the corporation’s board of directors, provided that certain requirements are met.
- 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