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Texas Office of Consumer Credit Commissioner issues bulletins regarding Covid-19 to regulated lenders, credit access businesses, tax lenders, and motor vehicle sales finance licensees
On March 26, the Texas Office of Consumer Credit Commissioner (OCCC) issued four bulletins directed at regulated lenders, credit access businesses, property tax lenders, and motor vehicle sales finance licensees in light of Covid-19. The bulletins urge these entities to work with borrowers during the crisis, including through taking the following measures:
- Increasing communication with borrowers regarding Covid-19.
- Working out modifications with borrowers to help ensure successful repayment, including deferred or partial payments, which would avoid delinquencies and negative credit reporting.
- Waiving certain fees or charges (e.g., late charges, additional finance charges, deferment charges, nonsufficient fund fees) during the disaster declaration.
- Suspending charging off accounts.
- Suspending repossession of vehicles, repossessions of collateral, foreclosure of real property, as applicable
The bulletins also provide guidance on the use of electronic signatures, which the bulletins note are generally allowed under Texas and federal law. The bulletins also provide that the OCCC will not take enforcement actions against regulated lenders, credit access businesses, property tax lenders, or motor vehicle sales finance licensees that conduct business activities from unlicensed locations, if conducted in accordance with certain data security, safe record keeping, and protection of personal information requirements set forth in the bulletins.
Ohio Department of Commerce, Division of Financial Institutions issues guidance regarding branch closures
The Ohio Department of Commerce, Division of Financial Institutions issued guidance to assist financial institutions when making the decision to limit branch operations or to close a branch. The Division advised that temporary closures of banking office locations for 48 hours or less must be reported to the Division and closures lasting longer than 48 hours must receive advance permission.
Massachusetts attorney general issues emergency regulation prohibiting certain debt collection practices
On March 27, the Massachusetts attorney general issued an emergency regulation that makes numerous standard debt collection actions an unfair and deceptive act or practice during the defined “state of emergency period.” Specifically, the emergency regulation prohibits both creditors and debt collectors from: (i) initiating, filing, or threatening to file any collection lawsuit; (ii) initiating or threatening to initiate any legal or equitable remedy for garnishment, seizure, attachment or withholding of wages, earnings, property or funds; (iii) initiating or threatening to initiate repossession of a vehicle; (iv) applying for, causing to be served or enforced, or threatening to apply for or enforce any capias warrant; (v) visiting or threatening to visit the household or place of employment of any debtor; and (vi) confronting or communicating in public with any debt regarding collection. In addition, the regulation also prohibits debt collectors from initiating phone calls with debtors, unless necessary to discuss a rescheduled court appearance or at the request of the debtor. These prohibitions do not apply to debts secured by mortgage on real property or debt owed by a tenant to an owner. The regulation will remain in effect for the early of: (i) 30 days after the lifting of the declared state of emergency; or (ii) 90 days.
On March 17, the Missouri Division of Finance communicated with state-chartered banks, requesting that the MDF be notified of any changes affecting schedules or services offered. If the closure of an entire facility for more than 24 hours is necessary, banks are instructed to ensure that the community has alternative means to access banking services.
Massachusetts Division of Banks addresses financial institutions and mortgage industry on Covid-19 provisions
On March 25, the Massachusetts Division of Banks communicated with the state’s financial services industry, stating that the Division “fully expects” institutions to provide relief to those borrowers adversely impacted during the Covid-19 crisis. These actions include: postponing foreclosures for 60 days; forbearing mortgage payments for 60 or more days from their due dates; waiving late payment fees and any online payment fees for a period of 60 days; refraining from reporting late payments to credit rating agencies for 60 days; offering borrowers an additional 60-day grace period to complete trial loan modifications, and ensuring that late payments during the Covid-19 pandemic do not affect their ability to obtain permanent loan modifications; and proactively reaching out to borrowers to explain the above-listed assistance being offered.
On March 26, the Massachusetts Division of Banks issued guidance adopting the policy changes proposed by the NMLS to provide a 60-day extension to all licensees to submit Call Reports and financial statements. Additionally MDB is temporarily instituting a policy to extend the Annual Report deadline by 60 days for regulated entities that cannot meet the original deadlines due to the Covid-19 crisis.
On March 18, the Maine Bureau of Consumer Credit Protection provided interim guidance to MLOs, allowing employees to work from home as long as data security provisions are in place, and physical business records are stored only at the licensed main office. The guidance will be effective through May 1, 2020.
California Department of Real Estate cancels real estate salesperson broker license exams through April 30
On March 26, the California Department of Real Estate announced that it is cancelling real estate salesperson broker license exams in all exam centers through April 30 in order to comply with state and local public health agencies ordering residents to shelter in place to slow the spread of Covid-19. Examinees will be allowed to reschedule their canceled exam dates using DRE’s eLicensing system and will not be charged rescheduling fees.
California State Assembly Banking and Finance Committee issues memorandum on Covid-19 banking and finance issues
On March 20, the California State Assembly Banking and Finance Committee issued a memorandum noting that state authority over large national banks “is significantly constrained by federal law.” The memorandum provides that, under the National Bank Act and related case law, courts have widely upheld federal preemption over state laws that “interfere with the business of banking.” As such, courts “would likely stop any attempts by the state to force banks to limit rates or fees, demand forbearance or loan modifications, or require banks to make certain loans.” While state officials may urge national banks to give their borrowers relief, “these requests do not carry the force of law.” The memorandum also discusses mortgage rates and home sales, noting that in the event that mortgage rates increase and negatively affect the real estate market, “state legislators have limited tools to address such problems.”
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- Garylene D. Javier to discuss "Navigating workplace culture in 2020" at the DC Bar Conference