DSNews delivers stories, ideas, links, companies, people, events, and videos impacting the mortgage default servicing industry.
Issue link: http://digital.dsnews.com/i/1228035
65 Special Report | COVID-19 NMSA PROPOSES COVID-19 RESPONSE TO ENSURE LIQUIDITY, STABILITY As the nation continues working to adapt to the ongoing consequences of the COVID-19 outbreak, both government agencies and industry stakeholders are working diligently to ensure stability and assist struggling homeowners. Some solutions put forward have included foreclosure suspensions, forbearance programs, and other forms of mortgage relief. On Friday, the National Mortgage Servicing Association (NMSA), a nonpartisan organization driven by senior executive representation from the nation's leading mortgage servicing organizations, released a proposal outlining their recommended steps in the light of some of these announced governmental programs. In a statement, Ed Delgado, President and CEO of Five Star Global, said, "With these extraordinary times, we recognize that the Federal government must work to present unprecedented solutions. To that end, the National Mortgage Servicing Association has assembled several strategic recommendations designed to help ensure liquidity to the banks, avoid the impact of unintended consequences, and protect American homeowners. We look forward to working with all stakeholders toward bringing our nation through this difficult time." NMSA's proposal outlines how Ginnie Mae programs, which include residential mortgage loans guaranteed by FHA, VA, and USDA, play a crucial role in the housing market by serving low-to-moderate income, communities of color, first-time homebuyers, and rural and veteran mortgage borrowers who typically do not qualify for conforming or bank loans and may be especially vulnerable during periods of economic stress, including the present COVID-19 pandemic. e proposal suggests that these borrowers could be assisted by a standard forbearance program, allowing them to defer interest and principal payments for up to six months, which is broadly consistent with proposed actions to address the COVID-19 pandemic on the part of Fannie Mae and Freddie Mac. Failing to support Ginnie Mae borrowers risks contributing to a downturn in the housing market and would put at risk the guaranty funds at FHA, VA, and USDA to the extent that higher delinquency and foreclosure-related losses emerge over time.