Compliance Newshub
Disaster News

DSNews--Seth Welborn

Natural disasters can be detrimental to household income and finances. In a research report published by the Urban Institute, funded by a grant from JPMorgan Chase, Urban takes a look effects of climate change-driven natural disasters on residents’ financial health, as measured by credit scores, credit card debt, debt in collections, bankruptcies, foreclosures, and auto debt.

According to the report, homeowners in particular are often strongly affected by natural disasters, having to juggle repair costs and possible temporary housing costs along with mortgage payments. Often, homeowners may fall behind on their mortgage payments and enter delinquency, eventually leading to foreclosure.

Urban’s study found that homeowners affected by Hurricane Sandy experienced stronger and more persistent increases in delinquency than those impacted by medium sized disasters. For medium sized disasters, such as tornadoes, Urban notes that though there is often an increase in delinquency, there is not a serious increase in foreclosure, unlike larger disasters such as hurricanes.

Another key point Urban notes is that the negative effects of disasters persist, or even grow over time, for important financial outcomes. The report calls for lenders and government sponsored enterprises to update existing mortgage delinquency and foreclosure policies to account for these long-term financial burdens following disasters.

Homeowners may also face a higher risk of foreclosure if they are underinsured. According to Frank Nothaft, Chief Economist for CoreLogic, “The disruption of a family’s regular flow of income and payments, as well as substantial loss in property value, can trigger mortgage default; especially if homeowners are underinsured and cannot afford to rebuild.”

CoreLogic’s 2019 Insurance Coverage Adequacy Report notes how each area at high risk for natural disasters, such as Southern California and wildfires and the Northeastern Atlantic and Gulf Coast regions from Hurricane damage, as well as Tornado Alley, can be impacted by insufficient funding.

California, according to the report, has seen an increase in reconstruction costs following recent wildfires, and these increases can cause significant undervaluation for the insurance industry.

DSNews--Radhika Ojha

Some states across the country saw an increase in home maintenance activities despite an overall housing slump in March. This, according to the latest BuildFax Housing Health report.

The report, which explored the projected impacts of hail season on the housing stock also leverages U.S. property condition and history data to deliver macro- and microeconomic trends.

The largest year-over-year increases were seen in New Mexico, New York, and North Carolina at 11.3%, 11%, and 7.5% respectively. Heading into summer, the report noted that the percentage of maintenance projects was likely to rise in hail- and hurricane-prone states.

It noted that as it rebuilds from the impact of Hurricane Florence, North Carolina continues to see elevated maintenance activity with recovery expected to last at least seven months for major repairs such as roof, plumbing, electrical, and mechanical.

As the hail season picks up, the report also projected increased maintenance work across the Midwest and Texas. According to the report, between 2011 and 2016, hail storms and wind damage accounted for 40% of all insured losses on a national level "and estimates continue to climb."

BuildFax also analyzed five severe hail storms over the past three years in Minnesota, Colorado and Texas to reveal that the average recovery of major systems following such storms lasts 5.4 months.

Roof and mechanical systems saw the most impact from a storm. The report noted that on a national level, roof maintenance increased 246.92% in the first three months following the average hailstorm compared to the year prior. In hail-impacted areas, homeowners risked repeated property damage, "but insight into property change and risk conditions enables carriers to accurately estimate claims pay outs and resolutions."

The report draws focus to property insurance as both, home maintenance and delinquencies tend to spike after a storm. As reported recently by DS News, without proper insurance, many homeowners impacted by natural disaster may be forced into foreclosure.

Looking at the overall housing market, the report saw a downward trend in housing indicators in March. While single-family housing authorizations decreased by 8.39%  existing housing maintenance volume decreased by 5.07% year over year.  Existing housing remodel volume also decreased by 9.76% during this period.

“The downward trend in housing activity has led to increased focus on the sector,” said Jonathan Kanarek, COO, BuildFax. Yet, there's hope for the spring season.

“In March, the Fed signaled no additional rate increases in 2019, which could boost investment in the housing market. The announcement is good news for consumers heading into the spring homebuying season. We may see some relief across maintenance and remodeling indicators, as home sales typically facilitate investment into the existing housing stock,” Kanarek said.

• Adds 11 counties for Public Assistance
• Adds 3 Counties for Public Assistance, Categories C - G (already designated for Individual Assistance and assistance for debris removal and emergency protective measures [Categories A and B], including direct federal assistance, under the Public Assistance program)
• Adds 5 counties for Public Assistance, Categories C - G (already designated for debris removal and emergency protective measures [Categories A and B], including direct federal assistance, under the Public assistance program)

Billing Code 9111-23-P

DEPARTMENT OF HOMELAND SECURITY

Federal Emergency Management Agency

[Internal Agency Docket No. FEMA-4420-DR]

[Docket ID FEMA-2019-0001]

Nebraska; Amendment No. 5 to Notice of a Major Disaster Declaration

AGENCY:  Federal Emergency Management Agency, DHS.

ACTION:  Notice.

SUMMARY:  This notice amends the notice of a major disaster declaration for the State of Nebraska (FEMA-4420-DR), dated  March 21, 2019, and related determinations.

DATE: This amendment was issued April 15, 2019.

FOR FURTHER INFORMATION CONTACT:  Dean Webster, Office of Response and Recovery, Federal Emergency Manage­ment Agency, 500 C Street, SW, Washington, DC 20472, (202) 646-2833.

SUPPLEMENTARY INFORMATION:  The notice of a major disaster declaration for the State of Nebraska is hereby amended to include the following areas among those areas determined to have been adversely affected by the event declared a major disaster by the President in his declaration of March 21, 2019.

Banner, Cheyenne, Dawes, Deuel, Franklin, Garden, Kimball, Phelps, Sheridan, Sioux, and Webster Counties for Public Assistance.

Saunders, Stanton, and Thurston Counties for Public Assistance [Categories C-G] (already designated for Individual Assistance and assistance for debris removal and emergency protective measures [Categories A and B], including direct federal assistance, under the Public Assistance program).

Brown, Harlan, Keya Paha, Lincoln, Merrick, and Rock Counties for Public Assistance [Categories C-G] (already designated for debris removal and emergency protective measures [Categories A and B], including direct federal assistance, under the Public assistance program).  

The following Catalog of Federal Domestic Assistance Numbers (CFDA) are to be used for reporting and drawing funds: 97.030, Community Disaster Loans; 97.031, Cora Brown Fund; 97.032, Crisis Counseling; 97.033, Disaster Legal Services; 97.034, Disaster Unemployment Assistance (DUA); 97.046, Fire Management Assistance Grant; 97.048, Disaster Housing Assistance to Individuals and Households In Presidentially Declared Disaster Areas; 97.049, Presidentially Declared Disaster Assistance - Disaster Housing Operations for Individuals and Households; 97.050 Presidentially Declared Disaster Assistance to Individuals and Households - Other Needs; 97.036, Disaster Grants - Public Assistance (Presidentially Declared Disasters);

97.039, Hazard Mitigation Grant.

/s/

____________________________________

Pete Gaynor,

Acting Administrator,

Federal Emergency Management Agency.

M Report--Radhika Ojha

How can data and analytics be utilized to manage risks to properties such as crime, vandalism, and emergency preparedness? This and many related questions were answered by experts during a DS News webinar titled "Risky Business: Using Data and Analytics to Protect Properties," presented by Safeguard Properties.

The webinar was moderated by Tim Rath, AVP, Business Development for Safeguard Properties, and featured insights from Jason Heckman, AVP, Mobile and Analytics for Safeguard Properties and John Thibaudeau, Director, Single-Family Real Estate for Fannie Mae into how technology is helping property preservation companies to identify cost-effective and timely solutions to protect and preserve homes.

During the webinar, Thibaudeau said that technology had made great strides to assist with property preservation, repairs, and marketing. He spoke about the tools and apps that are helping Fannie Mae get real-time information for properties that need inspection. They are also used to guide inspectors and users on what to look for once they reach the property and help Fannie Mae to absorb all the appraisal data to prioritize their work.

Discussing how data and technology go hand-in-hand for home repairs, Thibaudeau said that one of the key challenges companies face is ensuring consistency.

Speaking about the evolution of technology in property preservation, Heckman said that the data being used in property preservation at present helped companies understand the story that each house had to tell. He said that the evolution of data was also helping to "proactively manage anything that can go wrong."

While buying and implementing such technology can be a costly affair, Heckman pointed out that the benefits of these systems far outweighed the cost in terms of better targeting of potential issues and managing risks that include the prevention of services to the wrong property.

Answering a question on how servicing technology had changed today compared with what it used to be, Thibadeau said, "It is exciting to see how fast things continue to change. Today, speed is of the essence when you're moving to new technology to keep an advantage." Additionally, he said that technology continued to move on mobile solutions. "At the end of the day, we would love to provide technology to our customers where they can do business with us from anywhere."

"The introduction of iPhone really changed what we could do in terms of collecting data and getting things in real time. The improvement from where it was when we started in the mid-2000s to where we are now, has greatly changed the capabilities of what's available and what we can actually do," Heckman said.

Speaking about the type of technology that is being developed to address exceptions to vendor feedback, Heckman explained that it really went back to mobile technology and the aggregation of data. "We have capabilities to not only use scripts and text but also video capabilities which allow us to tell that story in real time," he said.

Looking at future technologies that were likely to advance property preservation procedures, both Thibadeau and Heckman concluded that artificial intelligence (AI) was the way forward. "The more interesting thing we’re seeing today is around AI and using machine learning to automate processes," Thibadeau said. "It’s going to continue to evolve over the coming years."

Heckman added, "With the advent of AI, and the Big Data movement the way data is being stored is changing and will continue to evolve as AI models improve."

Click here to view a recording of the webinar.

The topic of how the industry should prepare for and respond to disasters will be explored thoroughly at the upcoming Five Star Disaster Preparedness Symposium, to be hosted June 5-6, 2019, at the Hotel Monteleone in New Orleans. The Symposium is designed to provide an opportunity for mortgage industry leaders and executives to engage in critical conversations on diligence and preparedness, so the next time natural disaster strikes, the industry will be ready to lend the proper support. You can register for the Disaster Preparedness Symposium here.

1. Purpose. This Circular expresses concern about Department of Veterans Affairs (VA) home loan borrowers affected by the floods in Nebraska and describes measures mortgagees may employ to provide relief. Mortgage servicers and borrowers alike should review VA’s Guidance on Natural Disasters to ensure Veterans receive the assistance they need.

(https://www.benefits.va.gov/homeloans/documents/docs/va_policy_regarding_natural_disasters.pdf)

2. Forbearance Request. VA encourages holders of guaranteed loans to extend forbearance to borrowers in distress as a result of flooding. Careful counseling with borrowers should help determine whether their difficulties are related to this disaster, or whether they stem from other sources that must be addressed. The proper use of authorities granted in VA regulations may be of assistance in appropriate cases. For example, Title 38, Code of Federal Regulations (CFR), section 36.4311 allows the reapplication of prepayments to cure or prevent a default. Also, 38 CFR 36.4315 allows the terms of any guaranteed loan to be modified without the prior approval of VA, provided conditions in the regulation are satisfied.

3. Moratorium on Foreclosure. Although the loan holder is ultimately responsible for determining when to initiate foreclosure, and for completing termination action, VA has requested on its website (https://www.benefits.va.gov/homeloans) that holders establish a 90-day moratorium from the date of a disaster on initiating new foreclosures on loans affected by major disasters. VA regulation 38 CFR 36.4324(a)(3)(ii) allows additional interest on a guaranty claim when eventual termination has been delayed due to circumstances beyond the control of the holder, such as VA-requested forbearance. Because of the widespread impact of the disaster, holders should review all foreclosure referrals to ensure that borrowers have not been affected significantly enough to justify delay in referral. Any questions about impact should be discussed with the VA Regional Loan Center (RLC) of jurisdiction.

4. Late charge waivers. VA believes that many servicers plan to waive late charges on affected loans and encourages all servicers to adopt such a policy for any loans that may have been affected.

5. Credit and VA reporting. In order to avoid damaging credit records of Veteran borrowers, servicers are encouraged to suspend credit bureau reporting on affected loans. VA will not penalize affected servicers for any late default reporting to VA as a result. Please contact the appropriate RLC with any questions.

6. Activation of the National Guard. Members of the National Guard may be called to active duty to assist in recovery efforts. VA encourages servicers to extend special forbearance to National Guard members who experience financial difficulties as a result of their service.

7. Rescission: This Circular is rescinded April 1, 2020

DS News--Krista Franks Brock

More frequent and more severe natural disasters pose an increasing threat to communities across the nation, but a majority of experts do not support mandatory or government-sponsored insurance in high-risk areas.

Zillow previously predicted natural disasters will affect a record number of homes this year, and by 2050, more than 386,000 homes worth more than $200 billion “are at risk of permanent inundation or chronic flooding.” Instead of scaling back on construction in threatened areas, Zillow detected “homes are still being built at striking rates in areas that face high risks of future flooding.”

As Congress grapples with this challenge, attempting to determine the future of the National Flood Insurance Program, Zillow conducted its own survey on how the government should respond to the threat natural disasters pose to homes across the nation.

Fewer than one-fifth of the 100 real estate experts and economists surveyed agree that the government should subsidize or sponsor property-loss insurance, and fewer than half say the government should require such insurance in areas at high risk of natural disaster.

Sixty-eight percent of experts said the government should not subsidize or underwrite property-loss insurance.

Instead, experts favor “preemptive measures,” according to Zillow.

For example, experts tended to support stricter building codes with “state-of-the-art resilience standards” as well as full construction moratoriums in high-risk areas.

Some also favor infrastructure investments, such as seawalls or jetties.

Also, close to half, about 47 percent, of experts agreed that homeowners who cannot obtain or afford insurance should relocate to lower-risk, more affordable areas.

Zillow sponsored the survey as part of its Zillow Home Price Expectations Survey, which is conducted by Pulsenomics.

In terms of home prices, experts predict home price appreciation of 4.3 percent in the next year, as of the first quarter, which is up from a prediction of 3.8 percent in the previous quarter.

The increase could be the result of sliding mortgage rates, according to Terry Loebs, Founder of Pulsenomics.

Looking further into the future, Loebs said, “The longer-term outlook continues to be mixed and reflect uncertainties about housing supply, first-time homebuyer capacity, and other lingering market risks.”

In fact, at the high end, one group of experts predicted 28.3 percent price growth, while the group predicting the lowest price appreciation predict just 6.6 percent appreciation.

DS News--David Wharton

The U.S. Department of Housing and Urban Development (HUD) announced Friday that it will speed up federal disaster assistance to the states of Iowa and Nebraska in order to provide support to homeowners and low-income renters impacted by the severe storms and flooding that have impacted those regions.

This follows on President Trump's issuance of major disaster declarations in March for the counties of Fremont, Harrison, Mills, Monona, and Woodbury in Iowa and Boone, Buffalo, Butler, Cass, Colfax, Custer, Dodge, Douglas, Knox, Nemaha, Richardson, Santee Indian Reservation, Sarpy, Saunders, Thurston, and Washington in Nebraska. The Midwestern U.S. states experienced major flooding in March 2019 along the Missouri River, with the floods having caused an estimated $2.9 billion in damages in Iowa and $1.3 billion in Nebraska.

HUD's disaster assistance will include foreclosure relief and other assistance to qualifying families living within the affected areas, including:

• Immediate Foreclosure Relief—HUD's automatic 90-day moratorium on foreclosures of Federal Housing Administration (FHA)-insured home mortgages commenced for the Iowa counties covered under the Presidential declaration on the date of the declaration.
• Making Mortgage Insurance Available—HUD's Section 203(h) program provides FHA insurance to disaster victims whose homes were destroyed or damaged to such an extent that reconstruction or replacement is necessary and are facing the daunting task of rebuilding or buying another home. Borrowers from participating FHA-approved lenders are eligible for 100 percent financing, including closing costs.
• Making Insurance Available for Both Mortgages and Home Rehabilitation—HUD's Section 203(k) loan program enables those who have lost their homes to finance the purchase or refinance of a house along with its repair through a single mortgage. It also allows homeowners who have damaged houses to finance the rehabilitation of their existing single-family home.
• Making Information on Housing Providers and HUD Programs Available—The Department will share information with the Federal Emergency Management Agency (FEMA) and the State on housing providers that may have available units in the impacted counties. This includes Public Housing Agencies and Multi-Family owners. The Department will also connect FEMA and the State to subject matter experts to provide information on HUD programs and providers.

The topic of how the industry should prepare for and respond to disasters such as this one will be explored thoroughly at the upcoming Five Star Disaster Preparedness Symposium, to be hosted June 5-6, 2019, at the Hotel Monteleone in New Orleans. The Symposium is designed to provide an opportunity for mortgage industry leaders and executives to engage in critical conversations on diligence and preparedness, so the next time natural disaster strikes, the industry will be ready to lend the proper support. You can register for the Disaster Preparedness Symposium here.

IMPORTANT INFORMATION

Circular 26-19-8, Special Relief Following Alaska Earthquakes, was issued on March 1, 2019, and is located on the VALERI internet at https://www.benefits.va.gov/homeloans/servicers_valeri.asp.

Circular 26-19-7, Special Relief Following Alabama Severe Storms, Straight-line Winds and Tornadoes, was issued on March 8, 2019, and is located on the VALERI internet at https://www.benefits.va.gov/homeloans/servicers_valeri.asp.

Servicer Handbook Update – Revisions to multiple chapters and appendices have been posted in M26-4 and are reflected on the transmittal document dated February 26, 2019. They can be accessed at https://www.benefits.va.gov/homeloans/servicers_valeri.asp.

Appraisal Fee Changes – Appraisal fees for numerous states have recently been updated. The changes will be reflected on the VALERI Fee Cost Schedule, which is located at http://www.benefits.va.gov/HOMELOANS/servicers_valeri_rules.asp.

Fee Cost Schedule Updates – Effective March 8, 2019, the max allowable for the Posting Notice of Sale fee in Texas has been updated. This change is reflected on the VALERI Fee Cost Schedule, which is located at http://www.benefits.va.gov/HOMELOANS/servicers_valeri_rules.asp.

Assumptions – Guidance on Assumptions can be found in the M26-1, Chapters 2, Sections 5 and 6, and the Lender’s Handbook, Chapter 5, Section 7, which is located at https://www.benefits.va.gov/WARMS/Site_Map.asp.

REMINDER

Redemption Instructions – Redemption instructions are located on the VALERI internet at https://www.benefits.va.gov/HOMELOANS/servicers_valeri_guides.asp. All questions and inquiries related to redemption procedures are to be directed to vrm-redemption@vrmco.com.

Vacant Assets – The removal of hazardous materials from the exterior and interior of properties is a requirement prior to transferring custody of vacant properties, as outlined in M26-4 Appendix G located on the VALERI internet at https://www.benefits.va.gov/HOMELOANS/servicers_valeri_guides.asp.

VALERI Access – Individuals requiring assistance with VALERI access must contact their company administrator within their organization. The VALERI Helpdesk does not reset passwords or edit/create/activate/deactivate servicers’ user profiles. These types of requests should not be submitted to the VALERI Helpdesk (VA Servicer Handbook, M26-4, Chapter 2).

1. Purpose. This Circular expresses concern about the Department of Veterans Affairs (VA) home loan borrowers affected by severe storms and flooding in Iowa, and describes measures mortgagees may employ to provide relief. Mortgage servicers and borrowers alike should review VA’s guidance on natural disasters to ensure Veterans receive the assistance they need.

(https://www.benefits.va.gov/homeloans/documents/docs/va_policy_regarding_natural_disasters.pdf)

 2. Forbearance Request. VA encourages holders of VA-guaranteed loans to extend forbearance to borrowers in distress as a result of severe storms and flooding. Careful counseling with borrowers should help determine whether their difficulties are related to this disaster, or whether they stem from other sources that must be addressed. The proper use of authorities granted in VA regulations may be of assistance in appropriate cases. For example, Title 38, Code of Federal Regulations (C.F.R.), section 36.4311, allows the reapplication of prepayments to cure, or prevent a default. Also, 38 C.F.R. 36.4315, allows the terms of any guaranteed loan to be modified without the prior approval of VA, provided conditions in the regulation are satisfied.

 3. Moratorium on foreclosure. Although the loan holder is ultimately responsible for determining when to initiate foreclosure, and for completing termination action, VA has requested on its website (https://www.benefits.va.gov/homeloans), that holders establish a 90-day moratorium from the date of a disaster on initiating new foreclosures on loans affected by major disasters. VA regulation 38 C.F.R. 36.4324(a)(3)(ii), allows additional interest on a guaranty claim when eventual termination has been delayed due to circumstances beyond the control of the holder, such as VA-requested forbearance. Due to the widespread impact of the disaster, holders should review all foreclosure referrals to ensure that borrowers have not been affected significantly enough to justify delay in referral. Any questions about impact should be discussed with the VA Regional Loan Center (RLC) of jurisdiction.

 4. Late charge waivers. VA believes that many servicers plan to waive late charges on affected loans and encourages all servicers to adopt such a policy for any loans that may have been affected.

 5. Credit and VA reporting. In order to avoid damaging credit records of Veteran borrowers, servicers are encouraged to suspend credit bureau reporting on affected loans. VA will not penalize affected servicers for any late default reporting to VA as a result. Please contact the appropriate RLC with any questions.

 6. Activation of the National Guard. Members of the National Guard may be called to active duty to assist in recovery efforts. VA encourages servicers to extend special forbearance to National Guard members who experience financial difficulties as a result of their service.

7. Rescission: This Circular is rescinded April 1, 2020.

By Direction of the Under Secretary for Benefits

Jeffrey F. London Director, Loan Guaranty Service

MBA Residential Mortgage Briefs - March

Fannie Mae and Freddie Mac are reminding those impacted by flooding across the Missouri River Basin of available mortgage assistance options. Under the GSEs' guidelines for single-family mortgages:

--Homeowners impacted by the Missouri River Basin flooding are eligible for payment forbearance of up to 12 months, during which time they:
----will not incur late fees during this temporary payment break
----will not have delinquencies reported to the credit bureaus

--Servicers are authorized to suspend or reduce a homeowner's mortgage payments immediately for up to 90 days without any contact with the homeowner if the servicer believes the homeowner has been affected by a disaster. Payment forbearance of up to 12 months is available in many circumstances.

--Servicers must suspend foreclosure and other legal proceedings if the servicer believes the homeowner has been impacted by a disaster.

Fannie Mae 

Freddie Mac

DSNews--Seth Welborn

On Tuesday, the Committee on Financial Servicesheld a hearing entitled “The Administration of Disaster Recovery Funds in the Wake of Hurricanes Harvey, Irma, and Maria”, in order to discuss the impact of the HUD Community Development Block Grant (CDBG), and the allocation of funds following recent hurricanes to hit the East Coast, Gulf Coast, and Puerto Rico.

Witnesses at the hearing included Fernando Gil Enseñat, Secretary of Housing, Puerto Rico, Jeremy Kirkland, Counsel to the Inspector General, U.S. Department of Housing and Urban Development, Daphne Lemelle, Executive Director, Harris County Community Services Department, and Marion Mollegen-McFadden, Senior Vice President, Enterprise Community Partners.

The committee and witnesses discussed not only the handling of funds following natural disasters, but the increasing threat posed by the rising frequency of natural disasters such as hurricanes and wildfires.

“The data suggests that in the coming years, disaster recovery needs will likely grow substantially,” the committee’s memorandum stated. “In 2017, natural disasters combined to cause over $300 billion in direct  damages, a new U.S. annual record. All but four U.S. counties experienced substantial damage from some type of natural hazard between 1999 and 2013.”

In his statement, Secretary Gil Enseñat noted how Puerto Rico has utilized the CDBG funds, discussing the new Homebuyer Assistance Program in Puerto Rico.

“We’re creating a Homebuyer Assistance Program by investing $350,000,000 to help citizens purchase homes through a variety of support mechanisms, thereby increasing the level of homeownership in impacted communities and contributing to long-term sustainability and viability of communities across the island,” Enseñat stated.

Daphne Lemelle laid out a similar plan for the Houston area, which has experienced increased hurricane damage in the past few years. Lemelle notes that Harris county has been impacted by six Presidentially Declared Disasters in the last ten years, and how some aspects of state and federal rebuilding plans such as CBDG can become conflicting.

“For example, Harris County is currently opposing a state implemented rule that requires rebuilding of homes based on household size even if it means a reduction in home value,” Lemelle states. “Harris County believes this rule to be detrimental to the local homeowners and housing stock, as well as may have a discriminatory impact on certain households.”

Each witness put forth ideas to improve CDBG flexibility and outcomes, with an emphasis on making a more equality-focused system for homeowners during the rebuilding process.

Watch the complete hearing here. Find the written testimony from each witness here.

FIL-15-2019

March 26, 2019

Printable Format:

FIL-15-2019 - PDF (PDF Help)

Summary:

The FDIC has announced a series of steps intended to provide regulatory relief to financial institutions and facilitate recovery in areas of Nebraska affected by severe winter storms, straight-line winds, and flooding.

Statement of Applicability to Institutions with Total Assets under $1 Billion: This Financial Institution Letter applies to all FDIC-supervised financial institutions.

Highlights:

• Severe winter storms, straight-line winds, and flooding caused significant property damage in areas of Nebraska from March 9, 2019, and continuing.
• A federal disaster for selected areas in Nebraska was declared on March 21, 2019. Additional designations may be made after damage assessments are completed in the affected areas. A current list of designated areas is available at www.fema.gov.
• The FDIC is encouraging banks to work constructively with borrowers experiencing difficulties beyond their control because of damage caused by the severe weather.
• Extending repayment terms, restructuring existing loans, or easing terms for new loans, if done in a manner consistent with sound banking practices, can contribute to the health of the local community and serve the long-term interests of the lending institution.
• Banks may receive favorable Community Reinvestment Act (CRA) consideration for community development loans, investments, and services in support of disaster recovery.
• The FDIC also will consider regulatory relief from certain filing and publishing requirements.

Continuation of FIL-15-2019

Suggested Distribution:

• FDIC-Supervised Institutions in Nebraska

Suggested Routing:

• Chief Executive Officer
• Compliance Officer
• Chief Lending Officer

Related Topics:

• Lending
• Investments
• Publishing Requirements
• Consumer Laws
• Community Reinvestment Act

Contact:

• Assistant Regional Director Stephen Gaddie at (816) 234-8095 or SGaddie@fdic.gov

Note:

FDIC Financial Institution Letters (FILs) may be accessed from the FDIC's website at www.fdic.gov/news/news/financial/index.html.

To receive FILs electronically, please visit www.fdic.gov/about/subscriptions/fil.html.

Paper copies may be obtained through the FDIC's Public Information Center, 3501 Fairfax Drive, E-1002, Arlington, VA 22226 (877-275-3342 or 703-562-2200).