Top Story Lending Related

HUD has announced that it is charging a group of landlords in the Pittsburgh area with discriminating against prospective residents who have disabilities. HUD claims the owners and property managers of Beechwood Gardens in Pittsburgh and Southpointe Towers in West Mifflin denied housing to testers posing as prospective renters by refusing to grant them reasonable accommodations. HUD’s charge alleges that the owners and managers sent residents a notice stating that there would “no longer be any assigned [parking] spaces, no exceptions, even for people with disabilities.” The Fair Housing Partnership of Pittsburgh conducted a series of tests using testers posing as rental applicants who required designated parking spaces due to mobility disabilities. HUD alleges that respondents denied these testers requests for assigned parking at both Southpointe and Beechwood Gardens.

The FDIC has posted the public list of institutions that it has scheduled for a Community Reinvestment Act (CRA) examination during the fourth quarter of 2016. The list is published pursuant to revised CRA regulations published in May 1995 that require each federal bank and thrift regulator to publish a quarterly CRA examination schedule at least 30 days before the beginning of each quarter.

The Quarterly Banking Profile for the second quarter 2016 has been released by the FDIC.

The Federal Housing Finance Agency (FHFA) Index for July 2016 has been released. Nationally, interest rates on conventional purchase-money mortgages decreased from June to July, according to several indices of new mortgage contracts. The National Average Contract Mortgage Rate for the Purchase of Previously Occupied Homes by Combined Lenders Index was 3.62 percent for loans closed in late July, down 7 basis points from June. The average interest rate on all mortgage loans was 3.63 percent, also down 7 basis points. The average interest rate on conventional, 30-year, fixed-rate mortgages of $417,000 or less was 3.80 percent, down 8 basis points. The effective interest rate on all mortgage loans was 3.77 percent in July -- a drop of 6 basis points. The average loan amount for all loans was $325,700 in July, $8,200 less than the June average.

The Summer 2016 issue of Money Smart News has been posted by the FDIC, featuring articles on enhancements for small business; an easier way to join the Money Smart Alliance; tips on cybersecurity for bank customers; a discussion of mobile business and modernization of the payment system; and lending practices in financial education for postsecondary students. English and Spanish versions are available.

The June 2016 G.20 Finance Companies Owned and Managed Receivables Outstanding and Auto Loans: Terms of Credit data have been posted by the Federal Reserve System.

The NCUA has encouraged credit unions to work with their members and consider options for assisting them that include offering new loans with special loan terms or rates and reduced documentation, providing payment flexibility for current loans, or potentially restructuring existing loans. Federal credit unions with questions about these options should contact their examiners. Credit Unions are also reminded that NCUA Letter 11-CU-13 provides they may provide emergency financial services to nonmembers as part of their authority to engage in charitable activities under their incidental powers. Such services could include check cashing for nonmembers, access to ATM networks, or other means to access cash, to meet the short-term, emergency needs of nonmembers. Federal credit unions providing these emergency services must do so on a charitable basis, meaning that service charges cannot exceed direct costs.

The Federal Housing Finance Agency (FHFA) has announced that Fannie Mae and Freddie Mac (the Enterprises), at the FHFA's direction, will implement a new refinance option aimed at borrowers with high loan-to-value ratios. The new refinance offering will provide much-needed liquidity for borrowers who are current on their mortgage but are unable to refinance through traditional programs because their loan-to-value ratio exceeds the Enterprises' maximum limits. In addition the Home Affordable Refinance Program (HARP) will be extended through September 30, 2017. Links to Fannie Mae and Freddie Mac fact sheets were also provided.

HUD has announced new Federal Housing Administration (FHA) procedures to strengthen the process mortgage servicers use to help struggling families avoid foreclosure and remain in their homes. The FHA is streamlining the loss mitigation protocols that servicers must use when evaluating and deploying "home retention options," foreclosure alternatives that allow delinquent borrowers to retain their homes. Mortgagee Letter 2016-14 informs servicers of updated procedures for the evaluation and use of FHA’s Loss Mitigation Home Retention Options, the Manufactured Housing Review before initiation of foreclosure, and the servicing of FHA-insured Mortgages for Servicemember-Borrowers. Specifically, the FHA will:

• Require servicers to convert successful 3-month trial modifications into permanent modifications within 60 days instead of the average four-to-six months;
• Allow borrowers with three missed mortgage payments to qualify for a partial claim to bring their loans current versus the previous requirement for a minimum of four missed payments;
• End the traditional stand-alone Loan Modification option so struggling borrowers can access the FHA-HAMP option, with its greater payment relief, sooner; and
• Eliminate the required 12-month term for FHA’s special forbearance option. This will allow servicers to offer this option to more unemployed households.

The Department of Defense has published at 81 FR 58840 in the August 26, 2016, Federal Register an "Interpretive rule" in the form of an FAQ on its Military Lending Act regulation at 32 CFR Part 232. The series of 19 questions and answers "provides guidance on certain questions the Department has received regarding compliance with the July 2015 final rule." The rule became effective upon publication.