Loan modifications

The plan aims to cut monthly payments by roughly 25% for homeowners in government-backed mortgages who are negatively impacted by the pandemic.

Ginnie Mae is allowing lenders to securitize modified home loans with this extended term as the Biden administration works to make more housing options available for struggling borrowers.

The legislation would let banks postpone the start date of the Current Expected Credit Losses accounting standard and delay categorizing pandemic-related loan modifications as troubled debt restructurings.

Some lenders are poring over commercial portfolios more frequently than normal — perhaps as often as once a month — to uncover problems hidden by payment deferrals and government stimulus before it's too late.

Some homeowners who sought relief as a result of COVID-19 may owe a lump sum when their forbearance period ends, according to a report from the Committee for Better Banks. The group is calling on banks to instead extend the repayment periods for affected customers.

Measures designed to give banks and credit unions more flexibility to help customers weather the coronavirus pandemic are set to expire Dec. 31 unless Congress renews them.

More consumer and commercial borrowers are paying their loans, increasing the likelihood that charge-offs will be manageable for banks despite the ongoing pandemic.

Deferrals on residential mortgages and home-equity loans have been a common theme at JPMorgan Chase, Bank of America, Wells Fargo and Citigroup since the start of the coronavirus pandemic.

Mortgages taken out to fund business operations can now be modified in bankruptcy. That’s a relief to borrowers — particularly with business failures expected to increase as the pandemic drags on — but a possible headache for banks and investors that hold the loans.

Borrower relief is necessary in a national emergency, but if the exclusion of the deferred loans from troubled-debt restructurings is extended past the end of the year, safety and soundness could be compromised.

With no way of knowing just how many borrowers will need the mods after the coronavirus forbearance period ends, lenders are deploying artificial intelligence and servicing protocols to tame the ferocious piles of paperwork awaiting them.

Lenders that scrambled to grant forbearance as the coronavirus pandemic took hold are unsure about the extent of potential losses.

The lenders are bracing for spikes in delinquencies or defaults on loans to a sector heavily punished by social distancing measures.

More than a dozen firms have struck agreements with nine states to provide forbearance to customers struggling to make payments in the midst of the coronavirus pandemic.

Stress and exhaustion are catching up to lenders and call center employees helping customers grapple with the coronavirus pandemic.

In blue states in particular, governors and attorneys general are taking up the mantle of consumer protection during the coronavirus emergency, effectively adding another layer of regulation to the patchwork of state and federal oversight.

Homeowners reeling from coronavirus-induced economic shock are already enduring extremely long wait times while trying to get relief. Legislation passed last week could worsen the logjams.

JPMorgan Chase, Wells Fargo, Citigroup and U.S. Bancorp, along with 200 state-chartered banks and credit unions, have agreed to let borrowers skip payments for 90 days if their finances have been upended by the pandemic.

Accommodations for borrowers affected by the coronavirus pandemic, such as payment delays and fee waivers, are "positive and proactive actions that can manage or mitigate adverse impacts," several banking agencies said.

BofA, JPMorgan said they are paying bonuses to branch and call center employees; the bank says removing the $1.9 trillion limit on growth will help it lend to more customers in need.