Loan modifications

The change makes it easier for borrowers exiting forbearance to get access to home retention options that might otherwise be out of reach due to skyrocketing home prices.

Though the government-sponsored enterprises have some of the lowest forbearance rates in the market, they expect to contend with a significant population of borrowers who face steep financial setbacks after the pandemic ends.

However, the share of new impairments increased, likely as a result of the high concentration of these loans given to self-employed 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 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.

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

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.

Over 236,000 prime and subprime vehicle-loan borrowers received payment deferrals of between 30 and 120 days during the early economic turmoil of the coronavirus pandemic, according to the ratings agency.

The government-sponsored enterprises are focusing on how loans can be repaid after the federal forbearance period ends, and projections for loan modification volumes suggest the larger industry should, too.

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.

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.

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," the regulators said.

According to Moody's, Ally's latest auto-loan ABS will not require the issuer to repurchase loans with modified terms or maturities.

Freddie Mac is automating a manual form submission process used to correct post-settlement and real estate owned data, and adding policy changes aimed at accommodating electronic signatures on loss mitigation documents.

Caliber Home Loans settled a grievance with the Massachusetts attorney general over allegations of providing distressed borrowers with unaffordable loan modifications.

The bank agreed to modify loans to struggling U.S. borrowers as part of a 2017 settlement. Instead, it’s receiving credit for financing new mortgages that likely would have been made anyway.

An agency report said servicing portfolios have shrunk by nearly half in 10 years as much of the mortgage market has shifted to nonbanks.

The average home value backing the loans is $117,000, well below the average $150,000 of other recent RPL securitizations, according to Fitch Ratings.