Flexibility Requested in Wake of Natural Disasters
As Hurricane Season continues, regulators are reminding mortgage servicers to be reasonable and flexible when dealing with customers who have experienced loss from natural disasters. To that end, the Consumer Financial Protection Bureau published a reminder of its Supervisory Policy Statement on flexibility in laws and regulations for supervised entities while recovering from major disasters.
Similarly, on September 1, 2021, New Jersey entered a state of emergency via Executive Order 259. Pursuant to that order, the state, via bulletin 2021-9, is encouraging insurers, banks, credit unions, mortgage lenders and brokers, consumer lenders, insurance producers, real estate brokers, and any other person regulated by the Department of Banking and Finance to factor the effects of Hurricane Ida into its actions and decisions. Specifically, insurers are encouraged to relax due dates for premium payments, extend grace periods, wave late fees and penalties, allow forbearance with cancellation and non-renewal of policies, payment plans, and any other efforts to assist policyholders.
With respect to banking entities, the order encourages relaxing due dates for loan and mortgage payments, extending grace periods, modifying terms on existing loans, easing credit card limits, extending new credit, waiving late fees and other fees, allowing customers to defer or skip payments, and delaying submission of delinquency notices to credit bureaus.
The Proctor Loan Protector Compliance Team will continue to track storm based regulatory guidance.