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Freddie Mac announces system updates to facilitate use of exterior-only appraisals
On April 16, Freddie Mac announced that it will be adding a new feedback message (effective April 17, 2020) to Loan Collateral Advisor and Uniform Collateral Data Portal (UCDP). The message will note when exterior-only appraisals (as identified in the Map Reference field of the appraisal report) are submitted to UCDP using an incorrect appraisal form and will request resubmission to UCDP on the appropriate form.
CFPB raises HMDA reporting thresholds
On April 16, the CFPB issued a final rule permanently raising coverage thresholds for collecting and reporting data about closed-end mortgage loans and open-end lines of credit under HMDA. As previously covered by InfoBytes, these changes were first proposed by the Bureau last May. The final rule, which amends Regulation C, increases the permanent threshold from 25 to 100 loans starting July 1, 2020 and is applicable to both depository and nondepository institutions. The Bureau states in an executive summary that newly excluded institutions can stop collecting HMDA data on their closed-end mortgage loans beginning July 1, 2020; however, these institutions may still be obligated to collect home loan activity information required by other regulations. Under the final rule, newly excluded institutions are still required to record closed-end data for the first quarter of 2020; however because these institutions would not otherwise report the data until early 2021, the final rule relieves newly excluded institutions of the March 1, 2021 reporting obligation on data collected in 2020 (including closed-end mortgage loan data collected in 2020 prior to July 1, 2020). The Bureau notes that newly excluded institutions “may voluntarily report HMDA data on closed-end mortgage loans in 2021 as long as the institution reports data for the full calendar year 2020.”
The final rule also increases the permanent threshold for collecting and reporting data about open-end lines of credit from 100 to 200, however this change will not take effect until January 1, 2022, when the current temporary threshold of 500 open-end lines of credit expires (covered by InfoBytes here). Beginning in 2022, both depository and nondepository institutions that meet this threshold must report data on open-end lines of credit by March 1 of the following calendar year.
Additional resources, including a timeline of key dates and institutional/transactional coverage charts are available here. “The Bureau recognizes the operational challenges confronted by institutions due to the current COVID-19 pandemic,” the CFPB states in its press release. “The Bureau anticipates that this final rule, once effective, will reduce regulatory burden on smaller institutions to help those institutions to focus on responding to consumers in need now and in the longer term.”
Fannie Mae and Freddie Mac release Covid-19 forbearance scripts for servicers to use with homeowners
On April 15, Fannie Mae and Freddie Mac released Covid-19 scripts that servicers may use with homeowners impacted by Covid-19 when discussing forbearance options. The scripts are intended to assist servicers with, among other things, determining the nature of the borrower’s hardship and appropriately describing forbearance options to borrowers.
Rhode Island clarifies timing requirements for foreclosure mediation notices with CARES Act forbearances
On April 15, Rhode Island’s Superintendent of Banking issued a bulletin to clarify how mortgagors should implement CARES Act forbearances to accord with the state’s foreclosure mediation statute, which requires certain notices be mailed within 120 days of default. During the pendency of the Covid-19 pandemic, mortgagors must mail the required notice within 120 days after the termination of the forbearance agreement, subject to certain conditions.
Freddie Mac announces changes to forbearance program to align with CARES Act
On April 15, Freddie Mac announced revisions to its multifamily Covid-19 forbearance program to align with CARES Act provisions related to multifamily borrowers and tenants. The program now (i) no longer requires tenants to demonstrate that nonpayment is due to a Covid-19 related hardship in order to avoid eviction during the forbearance period, (ii) explicitly provides that borrowers may not charge late fees, penalties, or other charges related to nonpayment of rent during the forbearance period, and (iii) extends the last day to enter forbearance under the program to the end of the federally declared emergency period or December 31, 2020, whichever comes first.
California Department of Real Estate updates FAQs for licensing processes
On April 15, the California Department of Real Estate updated its FAQs for licensing processes. The FAQs answer questions relating, among other things, to the closure of DRE offices, the cancellation and rescheduling of licensing exams, renewal of real estate license, and electronic signatures on licensing documents.
CFPB and FHFA announce Borrower Protection Program
On April 15, the CFPB and the Federal Housing Finance Agency (FHFA) announced the launch of the joint Borrower Protection Program to address mortgage servicer performance during the Covid-19 emergency. The two regulators will share information about how responsive mortgage servicers are to requests for assistance from consumers who are not able to keep current on monthly mortgage payments. Under the program the CFPB will provide complaint and analytical tool information to the FHFA, which in turn will share loss mitigation data on mortgage servicers with the CFPB. Through the Borrower Protection Program, the CFPB and FHFA hope to combat confusing or misleading information from loan servicers to borrowers about their options, including forbearance, as prescribed in the CARES Act.
For more InfoBytes coverage on loan forbearance under the CARES Act, click here.
Brown and Waters urge housing market stability during Covid-19 pandemic
On April 15, Senator Sherrod Brown (D-OH) and Congresswoman Maxine Waters (D-CA) sent a letter to Federal Reserve Chairman Jerome Powell and Treasury Secretary Steven T. Mnuchin urging the agencies to use the authority granted under Title IV of the CARES Act to meet the needs of the housing market and ensure the stability of nonbank mortgage servicers as homeowners and renters struggle to make timely mortgage and rent payments. Brown and Waters stress that the “government must be prepared to respond quickly to prevent a liquidity shortfall in the single-family and multifamily mortgage markets, and to ensure that consumers are equitably served by that response.” They caution that while Ginnie Mae has announced measures to meet its servicers’ liquidity needs (covered by InfoBytes here), these changes “may be insufficient to address all of the liquidity challenges.”
Freddie Mac issues selling guidance related to Covid-19
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.
Fannie Mae updates appraisal guidance on impact of Covid-19
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.