CR calls on bankers to simplify process for getting hardship relief as April 1 mortgage payment deadline approaches
WASHINGTON, D.C. – Consumer Reports called on mortgage bankers today to adopt universal, simple programs to provide immediate relief to borrowers in light of the COVID-19 crisis. In a letter sent to the Mortgage Bankers Association, CR outlined a number of recommendations to ensure borrowers get the relief they need at a time when millions of Americans have lost their jobs and are struggling financially.
Consumer Reports’ letter to the MBA notes, “Nobody should face unnecessary financial hardship due to this emergency. Individuals facing hardship need maximum flexibility to cover expenses, and after the emergency passes, they must have a clear, manageable path back to repayment.”
CR urged bankers to take a number of steps to provide borrowers with relief by April 1:
- Make hardship relief universally available and seamlessly accessible. The option to defer payment should happen without any action by borrowers or any required proof of hardship. Borrowers who are not facing hardship may continue to pay, with their mortgage payments credited as normal.
- Provide borrowers with simple methods of extending relief periods. We are still in the early stages of the COVID-19 pandemic, but are already seeing deep economic impacts, the duration of which is impossible to determine at this time.
- Plan for what happens after the crisis. Lenders must have staff and processes in place to assist borrowers after the immediate crisis passes so that borrowers may make informed decisions about their options and avoid additional problems down the road.
- Do not report hardship relief as negative information to the credit reporting agencies. Fannie Mae has suspended negative credit bureau reporting of missed payments for borrowers under a forbearance plan as a result of hardships attributable to the national emergency. All financial institutions should do the same.
PLEASE NOTE: Consumer Reports has collected more than 800 stories from people around the country who are suffering severe financial consequences as a result of the current public health crisis. CR can connect reporters with those willing to be interviewed about their hardship experiences. To learn more, please contact Michael McCauley at firstname.lastname@example.org.
Michael McCauley: email@example.com, 415-902-9537