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Fannie Mae updates Single-Family Lender Letter 2020-03 regarding impact of Covid-19 on originations
On May 5, Fannie Mae issued updates to Lender Letter 2020-03. The letter is addressed to all Fannie Mae single-family sellers, and addresses the impact of Covid-19 on originations. Among other things, Fannie Mae extended temporary origination-related policies to June 30, 2020, reminded lenders of policies regarding the use of unemployment benefits as qualifying income, and clarified policies surrounding furloughed borrowers. Fannie Mae also updated guidance regarding age of documentation, verification of self-employment, market-based assets, powers of attorney, remote online notarization, and verbal verification of employment.
Fannie Mae updates Lender Letter 2020-04 to extend relief relating to appraisals
On May 5, Fannie Mae updated Lender Letter 2020-04, extending certain previously issued flexibilities until June 30, 2020. The extended flexibilities relate to, among other things, condominium project reviews, new construction loans, HomeStyle Renovation loans, and appraisal requirements.
FINRA reminds firms to be aware of fraud during Covid-19
On May 5, FINRA issued Regulatory Notice 20-13, reminding firms to be aware of the heightened threat of frauds and scams during the Covid-19 pandemic. The notice sets forth practices that firms may wish to implement to address risks relating to fraudulent account openings and money transfers, including a customer identification program, steps to monitor for fraud during account opening, bank account verification and restrictions on funds transfers, ongoing monitoring of accounts, collaboration with clearing firms, and compliance with Suspicious Activity Report filing requirements. The notice also sets forth methods that firms may employ to address risks relating to firm imposter scams and IT help desk scams.
FHFA extends loan processing flexibilities offered by Fannie Mae and Freddie Mac
On May 5, FHFA announced that it extended several loan processing flexibilities offered by Fannie Mae and Freddie Mac to assist borrowers during the Covid-19 emergency. The flexibilities include permitting alternative appraisals for certain loans, alternative methods for verifying employment before loan closing, flexibilities for providing documentation related to renovation draws, and expanding the use of power of attorney and remote online notarization. The flexibilities are extended until at least June 30.
North Carolina passes Covid-19 Recovery Act
On May 5, the North Carolina governor signed the Covid-19 Recovery Act, which provides certain relief to North Carolinians in response to the Covid-19 crisis. Among other things, the legislation authorizes emergency video notarization and video witnessing during the state of emergency. The legislation also provides limited immunity to essential businesses from civil liability for claims alleged to have been caused by the Covid-19 pandemic. Essential businesses include financial and insurance institutions, as determined by Executive Order 121, and any business that the Department of Revenue determines is essential.
Idaho establishes Idaho Rebound cash grants for small businesses
On May 5, the Idaho governor issued an executive order establishing Idaho Rebound cash grants for Idaho-domiciled small businesses. Among other things, businesses eligible for the grants must have had between 1 and 50 employees as of February 15, 2020; have suffered a qualified business interruption; and not have received a Paycheck Protection Program loan or an Economic Injury Disaster Loan Emergency Advance, or received less than $10,000 in such funds.
Regulators modify liquidity coverage rule for MMM and PPP participants
On May 5, the Federal Reserve Board, the OCC, and the FDIC announced an interim final rule that modifies the agencies’ Liquidity Coverage Ratio (LCR) rule to support participation in the Federal Reserve's Money Market Mutual Fund Liquidity Facility and the Paycheck Protection Program Liquidity Facility (previously covered by InfoBytes here and here). The LCR rule requires large banks to hold a certain amount of “high-quality liquid assets” in order to meet their short-term liquidity needs. The interim final rule modifies the agencies’ capital rules to neutralize the effects of participation. The rule is effective immediately and comments will be accepted within 30 days of publication in the Federal Register.
Alabama Securities Commission extends relief provided to registrants affected by Covid-19
The Alabama Securities Commission has extended a temporary order providing relief to registrants affected by Covid-19 to May 15, 2020, in light of the Alabama governor’s issuance of the April 28, 2020 “Safer at Home” order. The temporary order was originally covered here.
SEC issues Covid-19-related FAQs regarding the filing of reports
On May 4, the Securities and Exchange Commission issued FAQs responding to questions regarding disclosures that take advantage of extended filing deadlines under a March 25, 2020 Covid-19 Order and Form S-3. The issuances notes that staff may supplement or amend the responses to the FAQs.
Missouri extends various executive orders issued in response to Covid-19
On May 4, the Missouri governor issued Executive Order 20-10, which extends Executive Orders 20-04 (authorizing specific departments to waive or suspend statutory requirements and administrative rules), 20-05 (relating to the restaurant industry), 20-06 (relating to organized militia), and 20-08 (relating to remote notarization), issued in response to Covid-19. Executive Order 20-04 was previously covered here and Executive Order 20-08 was previously covered here.