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Freddie Mac announces paperless billing for seller/servicers
On April 23, Freddie Mac announced that it will no longer produce paper bills for seller/servicers with respect to performing loans and non-performing loans, starting with May 2020 invoices. Beginning May 2020, customers can access Fannie Mae’s electronic billing platform (eBill) to view the information previously provided via paper bills.
Fed announces temporary increase of intraday credit by Federal Reserve Banks
On April 23, the Federal Reserve (Fed) announced that it temporarily increased the availability of intraday credit that can be provided by the Federal Reserve Banks. In its policy statement, the Fed stated that it will automatically suspend net debit caps and waive overdraft fees to assist primary credit institutions, which are “eligible to borrow under the Federal Reserve’s primary credit program for the discount window.” In addition, the Fed announced that its max cap procedure will be streamlined to enable secondary credit institutions—which are “eligible only for the Reserve Banks’ secondary credit discount window program”—to utilize the max cap program to “request collateralized capacity from their Reserve Banks,” and will waive the requirement to obtain a self-assessed net debit cap and board resolution before requesting a max cap. The Fed’s actions are effective as of April 24 and will terminate on September 30.
Virginia legislature approves foreclosure relief for residential homeowners and renters
On April 22, the Virginia state legislature reenrolled HB 340, which provides foreclosure relief to residents affected by the Covid-19 crisis. The reenrolled bill expands protections previously extended to federal workers furloughed by a government shutdown to all residents during the pandemic, including a 30-day stay on foreclosure proceedings for owners of residential housing and a 60-day stay on detainers for nonpayment of rent.
New York attorney general: CARES Act payments are exempt from setoff, garnishment
On April 21, New York Attorney General Letitia James issued guidance clarifying that New York law exempts emergency stimulus payments made under the CARES Act from garnishment. Additionally, although New York law may, in certain circumstances, permit a bank to seize funds in a consumer’s account to pay a debt owed to the bank, the Office of the Attorney General views such a setoff against a CARES Act payment as unfair and abusive. James warned that the Office of the Attorney General would aggressively pursue any creditor or debt collector that garnishes or exercises a right of setoff against a CARES Act payment in violation of New York law.
Massachusetts enacts legislation imposing moratorium on certain evictions and foreclosures and requiring forbearance upon request
On April 20, the governor of Massachusetts signed legislation imposing a moratorium on certain eviction and foreclosure proceedings for the earlier of 120 days from the enactment of the legislation or 45 days after the state of emergency. In addition, the bill requires a creditor to grant a forbearance to a mortgagor that submits a request and affirms that the mortgagor has experienced a financial impact from Covid-19. Any payment subject to the forbearance must be added to the end of the term, unless otherwise agreed to. The legislation also prohibits a mortgagee or landlord from furnishing negative mortgage payment information or rental payment data to a consumer reporting agency related to payments subject to the act.
Oregon governor exempts CARES Act payments from garnishment
On April 17, the governor of Oregon issued an executive order exempting all CARES Act stimulus payments to individuals from garnishment, subject to limited exceptions. CARES Act payments will remain exempt from garnishment when deposited into a financial institution. The exemption will remain in effect until terminated by the governor.
Arizona Department of Insurance issues guidance on insurance customer relief
On April 16, the Arizona Department of Insurance issued Regulatory Bulletin 2020-04 to certain insurers. Such insurers are encouraged to offer relief to customers affected by Covid-19, such as refraining from cancelling or non-renewing policies due to non-payment during the hardship, working with insured on premium payments, waiving late fees, interest, and penalties, delaying premium increases, and suspending the use of credit reports for rating. Insurers implementing Covid-19 related customer relief programs must make an informational filing in SERFF to document their programs.
Connecticut regulator urges institutions not to use CARES Act checks to satisfy debt
On April 16, the Connecticut Department of Banking issued a letter to all Connecticut financial institutions, “strongly” urging them not to use stimulus payments to satisfy overdrafts and not to exercise any right of offset against other debts for 30 days after the payment is received without express consumer consent. If an institution’s systems automatically use the payment to satisfy an overdraft, the department urged reversing the transaction as soon as possible.
Texas Office of Consumer Credit issues revised emergency bulletin for lenders
On April 16, the Texas Office of Consumer Credit issued a revised bulletin outlining emergency guidance for regulated lenders navigating the Covid-19 crisis. The guidelines: 1) extended due date for filing annual reports from May 1 to June 1; 2) encouraged lenders to work with consumers, including by working out modifications to assist with payments, waiving fees and charges, suspending charged-off accounts, and suspending repossessions of collateral or foreclosure of real property, among other things; 3) reminded lenders of legal requirements for using electronic signatures; and 4) permitted lenders to conduct regulated lending activity from unlicensed locations, subject to certain conditions.
Agencies to hold webinar for bankers on loan modifications and reporting
On April 16, the FDIC released FIL-46-2020, announcing a webinar to provide accounting and reporting guidance for bankers pursuant to Section 4013 of the CARES Act and the revised Interagency Statement on Loan Modifications and Reporting for Financial Institutions Working with Customers Affected by the Coronavirus (covered by InfoBytes here). The webinar is scheduled for Friday, April 24 at 3:00 pm EDT and will be jointly hosted by the FDIC, the Federal Reserve, the OCC, and the NCUA. Participants are encouraged to email questions prior to the webinar to asktheregulators@stls.frb.org. To register for the webinar, click here.