FHA Urges Lenders to NOT Charge Late Fees Due to Shutdown
In addition to their contingency plan, HUD is making strides in order to ensure that borrowers continue to be well insulated during the shutdown. Strictly speaking, borrowers who are going through financial hardships, as a result of the shutdown, and are unable to keep up with their financial obligations for the time being.
For Carol Galante, the commissioner and assistant secretary for Housing at FHA, it’s crucial that all lenders and mortgagees help out borrowers during this time.
In a letter for all reverse mortgage professionals, Galante urges mortgagees extend an informal forbearance and seek out available loss mitigation options for government employees affected by the shutdown, in order to avoid foreclosure for the time being.
In truth, borrowers should not be punished for the government shutdown. They had nothing to do with it yet they are still paying the consequences via loss of income, some of which may never be reimbursed.
Galante also stated:
“FHA strongly encourages all approved mortgagees and lenders to waive late fees for affected borrowers and suspend credit reporting on borrowers nationwide who have been affected by the shutdown.”
For HUD, consumer protection continues to be of the outmost importance and I’m fully behind their initiative. Consumers are the bread and butter of our success so it’s in our best interest to protect them whenever we can, especially if they are being affected by circumstances outside of their control.
Presently, it seems that HUD is putting their best foot forward and trying to find solutions to recurring problems during the shutdown. There is little we could do until the shutdown is resolved but try to make an already difficult situation better. So far, that is what we’re doing.
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