Is Your Program CARES Act Compliant?

first_img Previous: Quicken Loans Officially Files for IPO Next: How Times of Crisis Cause Stress on Minority Homeowners July 8, 2020 1,736 Views Electronic Communications With BorrowersThe FAQs affirm that servicers may send servicing notices in electronic form and are subject to the requirements of the Electronic Signatures in Global and National Commerce Act. in Daily Dose, Featured, News, Print Features Demand Propels Home Prices Upward 2 days ago Thomas Grundy, CRCM, is senior director, U.S. Advisory Services for Wolters Kluwer. He has 34 years of combined experience as a former regulator, compliance professional, and consultant. Grundy launched his career as an examiner for the Office of the Comptroller of the Currency and later served as an oversight examiner for the Federal Reserve Board in Washington. In addition, he has served as a compliance officer for fintech and traditional banking and financial services organizations. In his current role, he advises banking, credit union, mortgage, student lending, and financial technology clients. Consumer Right to Request ForbearanceSection 4022 of the Act provides that a borrower experiencing financial hardship due to the COVID-19 pandemic can request forbearance for a federally backed mortgage loan, regardless of delinquency status. This process occurs through the submission of a request by a borrower to the servicer of his or her mortgage affirming that he or she is experiencing a financial hardship during the COVID–19 emergency. Upon this request by a borrower, the servicer is required to grant forbearance for up to 180 days. The servicer shall extend the duration of the forbearance for an additional period of up to 180 days.Upon receiving a request for forbearance from a borrower, the law provides that a servicer shall grant the request with no additional documentation required other than the borrower’s attestation to a financial hardship caused by the COVID–19 emergency. The law explicitly provides that during the period of forbearance “no fees, penalties, or interest beyond the amounts scheduled or calculated as if the borrower made all contractual payments on time and in full under the terms of the mortgage contract” can be assessed on the borrower. Servicers should be careful to comply with this prohibition. Governance processes and system-driven controls must ensure that no fees, penalties, or interest beyond the amounts scheduled or calculated—as if the borrower made all contractual payments on time and in full under the terms of the mortgage contract¬—are charged.These controls must remain fully established in connection with the 180-day forbearance period, as well as an extension for an additional period of up to 180 days, provided that the request is made during the covered period (although not specifically defined in the law, it presumably means during the original 180-day period) and that at the borrower’s request, either the initial or extended period of forbearance may be shortened. The Best Markets For Residential Property Investors 2 days ago Payoff StatementsThe FAQs address the question of whether servicers can take more than seven business days to provide a payoff statement due to operational challenges brought on by the pandemic. The FA Q s state that while the servicer does not need to provide the statement within seven business days, it should be provided within a “reasonable time.” Short-Term Loss Mitigation OptionsRegulation X generally requires servicers to obtain a complete loss-mitigation application before evaluating a mortgage borrower for a loss-mitigation option, such as a loan modification or short sale. However, the FA Q stipulate that CARES Act forbearance qualifies as a “short-term repayment forbearance program” under Regulation X. A servicer may offer a short-term payment forbearance program or a short-term repayment plan to a borrower, based upon an evaluation of an incomplete loss mitigation application. The FA Q s go a step further in stating that a servicer may offer any loss-mitigation options to a borrower who has not submitted an application at all. The FA Q s address communications requirements associated with short-term payment forbearance. The FAQs provide that “until further notice” servicers will not be cited in an examination or that the agencies intend to take supervisory or enforcement action for failing to provide acknowledgement notice within the five days of application for forbearance. The only qualifier is that servicers should make a good faith effort to provide notices and take the related actions within a reasonable time.Subsequent notices provided to the borrower provide information detailing the specific payment terms; duration of the program or plan; that the program or plan is based on an evaluation of an incomplete application; that other loss mitigation options may be available, and that the borrower has the option to submit a complete loss-mitigation application to receive an evaluation for all available options, regardless of whether the borrower accepts the short-term program or plan.  Servicers are required to provide the second communication in cases where the borrower remains delinquent near the end of the forbearance program or repayment plan. The servicer must contact the borrower prior to the end of the forbearance period and determine whether the borrower needs to complete the loss-mitigation application and proceed with a full loss-mitigation evaluation. The CFPB allows servicers the flexibility to add language to the subsequent notices to clarify why they are offering short-term options and to help avoid borrower confusion. The FA Q s state that servicers are under no requirement to tailor the first or second communications and may use similar content to conserve resources during the pandemic. Early Intervention Requirements Four questions relative to early intervention requirements are addressed in the FA Q s. The first two questions address whether servicers are required to comply with live contact requirements and early intervention written notice requirements, and they clarify the associated timelines in Regulation X, 12 CFR 1024.39(a) and (b). Similar to the agencies’ position on notifications, compliance with live contact and provision of the 45-day letter is generally expected. The FA Q s clarify that the agencies have agreed that they do not intend to cite in an examination or bring an enforcement action against servicers for delays in establishing or making good faith efforts to establish live contact and provide written notice.The focus during the pandemic is on “good faith efforts” which, the FA Q s clarify, consist of “reasonable steps, under the circumstances” that are defined as “calling the borrower on more than one occasion or sending written or electronic communication encouraging the borrower to establish live contact with the servicer.” The FAQs also contextualize what might constitute good faith, suggesting that the servicer should consider the length of a borrower’s delinquency, as well as a borrower’s failure to respond to a servicer’s repeated attempts at communication. Servicers will be considered in compliance with the early intervention live contact requirements if the servicer has established and is maintaining ongoing contact with a borrower under the loss mitigation procedures. The FAQs remind that live contact requirements are not applicable when a borrower is performing as agreed under a loss mitigation.The third and fourth questions address whether a servicer must comply with early intervention, live contact, and written notice requirements if the borrower is participating in CARES Act forbearance. The FAQs explain that the answers to these questions depend on circumstances, noting that borrowers can request a CARES Act forbearance regardless of delinquency status. More direct to the point here is that if the borrower is delinquent, the servicer must comply with early intervention requirements. Governmental Measures Target Expanded Access to Affordable Housing 2 days ago Continuity of Contact RequirementsThe FA Q s recognize that servicers may experience customer service call center staffing challenges due to the pandemic. As such, assigning a “single point of contact” to each delinquent borrower may prove difficult. The FA Q s grant some flexibility on this requirement, stating that “servicers must maintain policies and procedures reasonably designed to assign personnel to a delinquent borrower that can assist the borrower with loss mitigation options” and that a “servicer has discretion to determine whether to assign a single person or a team of personnel.” Is Your Program CARES Act Compliant? Move for foreclosure judgment or order of sale or conduct a foreclosure sale in the case of a borrower who is performing pursuant to the terms of a loss mitigation agreement.The FAQs also remind that small servicers are subject to and must comply with the payoff statement provisions in Regulation Z, 12 CFR 1026.36(c)(3). 2020-07-08 Mike Albanese Subscribe Annual Escrow StatementThe FAQs, in response to the question of whether servicers must conduct the annual escrow analysis and send annual escrow statements required by Regulation X, stipulates that the answer is yes. This response recognizes that escrow statements may generate call volume and contribute to borrower anxiety. As with earlier questions, the agencies do not intend to cite in an examination or bring an enforcement action against servicers for delays in sending the annual escrow statement—provided servicers make a good faith effort within a reasonable time. The agencies suggest that servicers inform the borrower that they are forgoing collection for several months on any shortage or deficiency. The FA Q s provide a reminder of the exemption from providing an annual escrow account statement when a borrower is more than 30 days past due. For borrowers who are subsequently reinstated and return to current status, servicers must provide a history of the account since the last annual statement within 90 days of the account’s reinstatement date to current status. Data Provider Black Knight to Acquire Top of Mind 2 days ago Share Save Governmental Measures Target Expanded Access to Affordable Housing 2 days ago Provide the first notice or filing required to foreclose if a borrower is performing pursuant to the terms of a loss mitigation agreement; and Servicers Navigate the Post-Pandemic World 2 days ago About Author: Thomas Grundy, CRCM Related Articles Agency Guidance Factors into the EquationOn April 3, the Joint Statement on Supervisory and Enforcement Practices Regarding the Mortgage Servicing Rules in Response to the COVID-19 Emergency and the CARES Act was released. This was a joint statement by the Consumer Financial Protection Bureau (CFPB), Board of Governors of the Federal Reserve System, Federal Deposit Insurance Corporation, National Credit Union Administration, Office of the Comptroller of the Currency, and Conference of State Bank Supervisors whereby they formally recognized the serious impact of the COVID-19 emergency on consumers and on the operations of many supervised entities, including mortgage servicers. The agencies stated an understanding that the COVID-19 crisis could impose temporary business disruptions and staffing challenges, thereby impeding the ability of lenders and servicers to assist consumers.Moreover, the agencies are emphasizing the potential for consumer confusion about how to access and exercise options offered by mortgage servicers. In issuing the Joint Statement, the agencies clarified the application of the mortgage servicing rules under Regulation X and established expectations for supervision and enforcement relative to the rules on short-term options as the industry works through the covered period. Coinciding with the release of the Joint Statement, the CFPB issued it’s Mortgage Servicing Rules FAQs related to the COVID-19 Emergency. The FA Q s support the Joint Statement by addressing common questions and themes. While not a substitute for Regulation X, Regulation Z, or the associated official interpretations, the FA Q s provide focus for helping servicers managing burgeoning requests from borrowers for help. This story originally appeared in the July edition of DS News. The COVID-19 pandemic has thrust the world into an unimaginably difficult situation. Though authors of science fiction may try, no one could have fully anticipated the scale and speed with which the pandemic would impact the economy. For mortgage lenders and servicers, the pandemic will prove to be a test of business continuity planning while managing processes and regulatory changes in real time, all while maintaining fairness and compliance across all aspects of day-to-day operations.The CARES Act (Pub. L. No. 116-136) was enacted on March 27, 2020, to provide financial assistance and other types of relief as the negative economic impact of the COVID-19 pandemic set in across the country. The consumer finance provisions under Title IV of the Act directly address helping Americans struggling to make mortgage payments due to the economic slowdown caused by the pandemic. These provisions cover “federally-backed mortgage loans,” which are defined under the Act as any loan that is secured by a first or subordinate lien on residential real property designed principally for the occupancy of from one-to-four families that is:insured by the Federal Housing Administration or under the National Housing Act;guaranteed or insured by the Department of Veterans Affairs or the Department of Agriculture; orpurchased or securitized by the Federal Home Loan Mortgage Corporation or the Federal National Mortgage Association. For servicers of mortgages not covered by the CARES Act, the provisions of the Act serve as guidance applicable to servicers helping millions of borrowers with covered loans. Given the profound impact of the pandemic across all sectors of the economy and its 24-hour coverage in the news, consumers are aware of the assistance made available by theHowever, awareness of important details is generally lost on the average consumer. Thus, for servicers of non-federally backed mortgages, it is likely that the calls will come in large volume from borrowers seeking help from loan servicers. Helping borrowers stay in their homes and maintain their lives generally yields a positive outcome over the long haul for borrowers, lenders, local economies, and the government. Data Provider Black Knight to Acquire Top of Mind 2 days ago Foreclosure MoratoriaSection 4022(c)(2) of the Act further provided that servicers of federally backed mortgage loans could not initiate any judicial or nonjudicial foreclosure process, move for a foreclosure judgment or order of sale, or execute a foreclosure-related eviction or foreclosure sale for not less than the 60-day period beginning on March 18, 2020, which has been extended by federal housing agencies until August 31, 2020. The Act provided an exception for a vacant or abandoned property. It is always prudent to closely monitor foreclosure and collection policies, procedures, and actual practices to ensure fairness and appropriate customer treatment at all times. Exemptions for Small ServicersTo the question of whether small servicers  are subject to the requirements, the FA Q s provide that small servicers do not have to comply with the early intervention and continuity of contact requirements. Small servicers must comply with the foreclosure restrictions of Regulation X, 12 CFR 1024.41(j), as well as the escrow requirements of Regulation X, 12 CFR 1024.17. With respect to foreclosure restrictions, the FAQs make it clear that small servicers shall not:Provide the first notice or filing required to foreclose, unless theBorrower’s mortgage loan obligation is more than 120 days delinquent, Trying Times These are truly unprecedented times. Consumers are facing difficult choices. As the Joint Statement underscores, mortgage servicers play a vital role in assisting consumers in providing options for paying their mortgages. The current crisis presents potential financial challenges to borrowers; the CARES Act Section 4022 and 4023 are intended to provide some measure of related relief. However, there is a risk of confusion for borrowers, lenders, and mortgage servicers. The flexibility that the agencies can offer pursuant to the Joint Statement, and as further clarified by the CFPB’s FA Q s, helps to reduce the immediate regulatory risk and pressure. The focus is on making a good faith effort to respond to the needs of borrowers.However, mortgage servicers must make certain that their existing Regulation X related compliance practices for loss mitigation are appropriately modified in light of the guidance set forth in the Act and the guidance published by the agencies. Given the stress of the times we’re living through, it is vital to not lose sight of the fact that these efforts must be fulfilled in a fair and responsible manner. Through reasonable efforts to maintain a tone of fairness and compassion; to ensure that governance is up to date with regulatory guidance; that processes and system controls are in alignment; and that reasonable monitoring of workflows and production output is conducted, the mortgage servicing industry can and must move forward. While resources may be stressed, keep an eye to the future, knowing that the metrics of the current period will tell the story of the good faith effort made.DISCLAIMER: The information and views set forth in this piece are general in nature and are not intended as legal or professional advice. Although based on the law and information available as of the date of publication, general assumptions have been made by Wolters Kluwer Financial Services that may not take into account potentially important considerations to specific businesses. Therefore, the views and information presented in this feature may not be appropriate for you. Readers must also independently analyze and consider the consequences of subsequent developments and/or other events. Readers must always make their own determinations in light of their specific circumstances. Servicers Navigate the Post-Pandemic World 2 days ago Sign up for DS News Daily  Print This Post Demand Propels Home Prices Upward 2 days ago Home / Daily Dose / Is Your Program CARES Act Compliant? The Best Markets For Residential Property Investors 2 days ago Foreclosure is based on a borrower’s violation of a due-on-sale clause, orServicer is joining the foreclosure action of a superior or subordinate lienholder The Week Ahead: Nearing the Forbearance Exit 2 days agolast_img read more

Unveiling the ancient climate of Mars

first_imgThe high seas of Mars may never have existed. According to a new study that looks at two opposite climate scenarios of early Mars, a cold and icy planet billions of years ago better explains the water drainage and erosion features seen today.For decades, researchers have debated the climate history of Mars and how its early climate led to the many water-carved channels there now. The idea that 3 to 4 billion years ago Mars was warm, wet and Earth-like, with a northern sea — conditions that could have led to life — is generally more accepted than the concept of a frigid, icy planet where water was locked in ice most of the time and life would be hard put to evolve.To see which early Mars model better explains the planet’s modern features, Robin Wordsworth, assistant professor in environmental science and engineering at the Harvard John A. Paulson School of Engineering and Applied Sciences, and his colleagues used a 3-D atmospheric circulation model to compare a water cycle on Mars under different scenarios 3 to 4 billion years ago, during what are called the late Noachian and early Hesperian periods.One scenario looked at Mars as a warm and wet planet with an average global temperature of 10 degrees Celsius (50 Fahrenheit), and the other as a cold and icy world with an average global temperature of minus 48 degrees Celsius (minus 54 Fahrenheit).The study’s authors found that the cold scenario was likelier to have occurred than the warm one, based on what is known about the history of the sun and the tilt of Mars’ axis long ago. The cold model also did a better job of explaining the water erosion features that were left behind on the Martian surface, which have puzzled and intrigued scientists since they were discovered by the Viking orbiters in the 1970s.A paper presenting the results has been accepted for publication in the Journal of Geophysical Research: Planets.The colder scenario was more straightforward to model, Wordsworth said, because Mars only gets 43 percent of the solar energy Earth does, and early Mars was lit by a younger sun believed to have been 25 percent dimmer than it is now. That makes it very likely that early Mars was cold and icy, he said. An extreme tilt of Mars’ axis would have pointed the planet’s poles at the sun and driven polar ice to the equator, where water drainage and erosion features are seen today.More importantly, under a thicker atmosphere, equatorial highland regions get colder and northern lowland regions get warmer. This is the “icy highlands effect” that accounts for snow-covered mountain peaks on Earth today. Despite a number of warming factors — including a thicker atmosphere filled with climate-warming carbon dioxide — Mars still would have been quite cold, Wordsworth added.Creating a model for a warm and wet Mars took more work. Previous studies had shown that even when the effects of climate-warming clouds, dust, and carbon dioxide were taken into account, climate models still didn’t show early Mars developing any warm and wet periods, Wordsworth said.But the conditions on early Mars may have been different than scientists thought, he said. The study’s authors added to their model various climate effects to force Mars into a warmer, wet state. Even then, however, a warm and wet early planet does not explain the patchwork of water erosion features and valley networks observed on Mars today, and why these features tend to be concentrated near the planet’s equator, Wordsworth said.Under the warm and wet model, rainfall rates varied a lot with longitude and latitude. The warm and wet model predicts that on early Mars, rain was greatest in an area called Arabia and around the Hellas basin, including in the west and southeast areas of the basin, where few water drainage features are found now. At the same time, several regions with many water-carved valleys, such as Margaritifer Sinus, received one-tenth to one-twentieth as much rain as Arabia and the Hellas basin under the warm and wet scenario.In the warm and wet scenario, mountains also create rain shadows, like those that wring water from clouds to help create deserts on Earth. On Mars, the bulge of Tharsis would have caused more rain to fall on the windward western side of the volcanic plateau, where few water features are seen. To the east, downwind of the bulge, drier air would flow over Margaritifer Sinus, causing less rain to fall — a situation that doesn’t match the drainage features observed there.The cold and icy scenario isn’t perfect, , Wordsworth said. While this scenario accumulates frozen water closer to the drainage features on Mars, something had to melt the ice that carved the valleys, he said. Under this scenario, the climate is cool most of the time, and then short-lived events like meteor impacts and volcanic eruptions caused the necessary melting.“I’m still trying to keep an open mind about this,” said Wordsworth. “There is lots of work to be done, b.”Proving that a cold climate on early Mars led to the features seen on the planet today would answer a big question, said Bethany Ehlmann, a planetary scientist at the California Institute of Technology and NASA’s Jet Propulsion Laboratory in Pasadena, Calif., who was not involved in the study.The new paper answers part of that question by showing that locations with snow in the cold and icy scenario roughly correspond to valley network locations seen today, Ehlmann said. Furthermore, the model of the cold early Mars shows that some ice melting would occur, she said.“We know from Rover and orbiter-based data that there were lakes on ancient Mars,” she said. “Key questions are: How long did they persist? Were they episodic or persistent? And does the feeder valley network demand rain, or is snow and ice melt sufficient?”The 3-D climate modeling used in the study begins to address these questions with a new level of sophistication by investigating how specific locations might have accumulated rain or snow, she said.last_img read more

Wellington Police Notes: Thursday, April 14, 2016

first_imgWellington Police notes: Thursday, April 14, 2016:•12:40 a.m. Officers assisted an outside agency in the 100 block W. Appleblossom, Wellington.•2:05 a.m. Merissa D E Franke, 19, Wellington was issued a notice to appear for defective headlight.•8 a.m. Officers investigated a battery in the 1700 block E. 16th Wellington by a known suspect.•1:03 p.m. Officers investigated harassment by Telecom Device in the Wellington.•4:09 p.m. Officers investigated a theft of doors and windows in the 200 block S. Patterson, Wellington.•5:05 p.m. Officers took a report of children in need of care, Argonia.•6:51 p.m. Officers took a report of suspicious activity in the 1000 block Shady Lane Ct., Wellington.last_img

Focus back on Senate GOP after House passes felon voting limitations

first_imgDES MOINES — Republicans in the Iowa House Wednesday night approved legislation to forbid paroled felons who owe victim restitution from voting if Iowans approve a constitutional amendment that automatically restores felon voting rights.“We’re talking about somebody who potentially killed someone,” said Representative Bobby Kaufmann, a Republican from Wilton, “not just some dismissive bill they can’t pay.”Representative Mary Wolfe, a Democrat from Clinton, is a criminal defense attorney. Wolfe suggested tonight was a strange time to pass the bill as over 1000 protesters 50 blocks from the Capitol were calling for criminal justice reform.“It’s punishing people because they do not have the financial resources to pay a debt,” Wolfe said. “It’s a poll tax.”Representative Ras Smith of Waterloo, a Democrat, said the bill exacerbates inequities in the criminal justice system.“You are knowingly utilizing legislation to guarantee that poor Iowans are disproportionately impacted and shut out from the process to raise their voices,” Smith said. “That’s just what it is.”Kaufmann said this bill was always “part two” of Republican lawmakers’ plans on felon voting rights.“If I’ve got care-o-meter for the rights of the victim, it’s up here,” Kaufmann said. “And if I’ve got a care-o-meter for the rights for the people who committed the crimes and hurt them, it’s a lot lower.”The bill goes to the governor, so attention shifts back to Senate Republicans who’ve balked at passing a plan to end Iowa’s status as the only state that bans felons from voting once they’re released from prison. In 2019, Governor Reynolds called on lawmakers to pass a resolution for a constitutional amendment that would automatically restore felon voting rights. She has resisted calls to accomplish that with an executive order, as former Governors Vilsack and Culver did.Reynolds has streamlined the system for individuals seeking voting rights through applications she must review and approve.last_img read more