The FHFA’s forbearance extension to September is forcing nonbank servicers to buy out more delinquent loans. It's also upended loss estimates for investors and made racial and income disparities in the mortgage market worse.
The agency will allow an additional three months of forbearance for loans backed by Fannie Mae and Freddie Mac, giving homeowners up to 18 months to suspend payments due to the pandemic.
The economic fallout from COVID-19 has highlighted systemic concerns about commercial real estate exposure, business debt and short-term wholesale funding, the Financial Stability Oversight Council said in an annual report.
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.
The templates are meant to make it easier to obtain agency approval for small-dollar loan products and to accommodate mortgage servicers that want to provide online loss mitigation options.
