Servicing

Refinancing activity is surging, existing borrowers are inquiring about loan modifications, loan closings are being delayed by more complex credit checks — and banks are short on people to handle it all.

Forbearance and loan-modifications programs implemented after the financial crisis left borrowers bewildered and angry. Now the mortgage industry wants to create a common standard for providing relief to homeowners whose livelihoods have been upended by the coronavirus pandemic.

The pandemic has upended staffing plans, sparked concerns about servicers’ capacity to handle the expected crush of missed payments, and even raised questions about their ability to stay afloat.

A national moratorium would be costly to lenders and servicers, but proponents say it's needed to help cushion the economic blow of the pandemic.

No-interest loans and overdraft forgiveness are among the lifelines banks are offering to consumers and small businesses whose livelihoods are being upended by the economic fallout.

Banks' lowering of origination fees and loosening of underwriting standards often foreshadow a downturn.

Despite changes by the Federal Housing Administration, bankers remain reluctant to join the program for fear of legal liability. But that could change if it revamps servicing processes, experts say.

A report from the Financial Stability Oversight Council cited a bigger share of originations and servicing by nonbanks as a potential vulnerability in the financial system.

Financial regulators have been put on notice about the risk of an economically damaging cash crunch in the home mortgage market. Behind the concern: the rapid growth of shadow banks in the origination and servicing of home loans.

The San Francisco fintech company has agreed to pay a $110,000 fine for failing to comply with a 2017 state law that requires mortgage servicers to be licensed.