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On April 23 and 21, nine states announced a multi-state initiative to provide student loan relief options for borrowers with privately held student loans not covered by the CARES Act. California, Colorado, Connecticut, Illinois, Massachusetts, New Jersey, Vermont, and Washington outlined within their announcements specific measures for borrowers with commercially-owned Federal Family Education Loan Program loans and borrowers with private student loans who are struggling to make payments due to the Covid-19 pandemic. The announcements also noted that Virginia is participating in the initiative as well. These relief options, offered in conjunction with the listed private student loan servicers, include (i) a minimum 90-days of forbearance relief; (ii) a waiver of late fees; (iii) no negative credit reporting; (iv) a 90-day moratorium on collection lawsuits; and (v) enrollment in applicable borrower assistance programs, such as income-based repayment. The states cautioned that enrollment in these relief options is not automatic, and recommended borrowers contact their student loan servicer to see what options best suit their needs.
In addition, California, Colorado, Connecticut, New Jersey, Vermont, and Washington recommended that regulated student loan servicers with limited ability to take these actions due to investor restrictions or contractual obligations “should instead proactively work with loan holders whenever possible to relax those restrictions or obligations.”
On April 8, the Colorado Division of Banking issued guidance to state-chartered banks encouraging them to take measures to assist borrowers impacted by Covid-19, including halting foreclosures and providing a 90 day deferment on payment for all consumer loans. The division noted that while state-chartered banks are not required to comply with these requests, any efforts to modify existing loan terms will not be subject to examiner criticism.
Effective March 30, the Colorado secretary of state amended its State Notary Program Rules to temporarily authorize and establish minimum standards for remote notarization. The amended rules require that both the notary and the remotely located individual be in the state of Colorado, that the system used to perform remote notarization must enable the notary to verify the identity of the remotely located individual and any required witness, that the notary, individual, and any witness are viewing the same record, and that all signatures or changes to the record made by the individual or witness are made in real time.
Colorado issues executive order temporarily suspending the personal appearance requirement for notarization due to the presence of Covid-19
On March 27, the Colorado governor issued an executive order temporarily suspending the requirement to appear personally before notarial officers to perform notarizations. The order authorizes the Secretary of State to issue temporary emergency rules to permit notarial officers to perform remote notarizations. The order does not affect the rights or duties of parties to existing contracts of insurance or other private contracts that may require or anticipate in-person notarization of documents. The order expires within 30 days of issuance, unless extended further by executive order.
On March 27, Colorado’s Division of Banks and Division of Financial Services distributed a document consolidating Covid-19 related guidance regarding inspections and appraisals from the Appraisal Standards Board, Fannie Mae, Freddie Mac, and the FDIC. Taken together, the agencies have issued guidance indicating that they will accept external-only or desktop inspections and appraisals in light of risks of conducting interior inspections during the Covid-19 outbreak.
Colorado issues guidance on business continuity, pandemic planning to credit unions, savings and loan institutions
On March 10, the Colorado Department of Regulatory Agencies, Division of Financial Services, issued guidance on business continuity and pandemic response to Colorado state-chartered credit unions and savings and loan institutions. The guidance reminds regulated financial institutions to review and revise, if necessary, the institutions’ business continuity and pandemic response plans, which could also include liquidity management, contingency funding, and emergency response plans.
On March 16, the Colorado State Bank Commissioner issued guidance requesting that financial institutions notify the Division of Banking of any issues they may experience involving continuing operations, any unusual account withdrawals, FDIC insurance questions, or any other banking matter. The guidance also requests email notification of any changes to the financial institutions’ banking hours. With respect to scheduled and upcoming examinations, the Division is prepared to “adjust planned supervisory activities as events dictate, and will conduct as much of the examination as possible offsite.”
On March 20, the Colorado Governor issued an executive order limiting evictions and foreclosures because of Covid-19. The order requests that $3,000,000 from the Disaster Emergency Fund be made available to the Department of Local Affairs to provide short-term rental and mortgage assistance to low-income households facing financial hardship due to Covid-19. Among other things, the order also directs the Department of Regulatory Agencies (DORA), through the Divisions of Banking and Financial Services, to take steps to encourage banks, credit unions, and other financial institutions that are holding residential or commercial mortgages to halt foreclosures and related evictions in connection with the Covid-19 pandemic. DORA is further directed to encourage financial institutions to provide a 90-day deferment of payment for all consumer loans (e.g., residential and commercial mortgages, refinances, auto loans, small business loans). While some provisions of the order are effective for six months from the date of issuance, most provisions expire within 30 days from March 20, 2020, unless extended by executive order.
Colorado issues executive order and public health order requiring in-person workforce reduction of nonessential businesses
On March 22, the Colorado Governor issued an executive order requiring Colorado employers to reduce in-person work requirements by 50 percent for non-critical workplaces due to the presence of Covid-19. A public health order issued by the Colorado Department of Public Health and Environment subsequently that detailed the critical businesses that may continue to operate as normal. “Critical businesses” include financial institutions such as banks, credit institutions, insurance, payroll and accounting services, and services related to financial markets. The orders are effective through April 10, 2020, unless rescinded or modified.
On March 16, the Colorado Department of Regulatory Agencies sent an email reiterating that Colorado mortgage loan originatos (MLO) may perform licensed activities at a location other than at their registered work location. The Division notes that Colorado does not have any requirements regarding specific work locations at either the company or individual MLO level.