MReport April 2020

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16 | M R EP O RT More than 25 mortgage banks and nonbank servicers, legal pro- fessionals, and service providers will take part in the coalition. The U.S. Department of Housing and Urban Development (HUD) also announced provi- sions to combat COVID-19. HUD issued a waiver on servicing policy requiring mortgagees to establish in-person contact with borrowers during early-default intervention. The Hon. Brian D. Montgomery, Assistant Secretary for Housing–Federal Housing Commissioner, said the policy is "not practical given the public health recommendations being disseminated by local, state, and federal government agencies to limit contact between individuals, in order to contain the spread of the COVID-19 virus." Courtney Thompson, SVP Default Mortgage Servicing, Flagstar Bank, told MReport that delinquency rates will "inevitably increase" but the real question is, "how much?" "At this point, we are still in a close monitoring stage to determine the real extent of any impact," she said. "At Flagstar, every department has compre- hensive business continuity plans that are regularly reviewed and updated. So we have that locked down, and we're ready to go. Still, servicers really need to answer the question: Do I have the infra- structure for my entire workforce to work remotely for say, 14 to 30 days or even more? Thompson added that if these issues can be addressed, the question becomes how does the industry define and manage productivity for an operation that runs on a workforce that is not traditionally remote. RoundPoint Mortgage Corporation's CEO Kevin Brungardt said of the virus, "During these uncertain times, with the novel coronavirus (COVID-19) pandemic, our primary focus is on protecting our people, our communities, our company and our customers. As a company, RoundPoint is commit- ted to minimizing the spread of this virus." Brungardt added that RoundPoint's senior executive team created an Executive Task Force to create and implement measures to ensure a "safe busi- ness continuity environment." The task force has implemented suspension of all non-essential business travel, extended its work- from-home policy to all team members if available, and badge access has been turned off for employees not authorized to work in RoundPoint buildings. Additionally, the RoundPoint executive team meets at least three times a day to discuss the situation. Employees that are au- thorized to work in the building have their temperature taken prior to entering the building. "The Senior Executive team will continue to closely monitor the situation to ensure the safety of our people, our customers, and the community," he said. Michael King, VP Corporate Communications, Southwest Region of Wells Fargo, noted the company is "working on a daily basis" to support the needs of the customers impacted by the coronavirus. "We are currently providing assistance including fee waivers, payment deferrals, and other ex- panded assistance for credit card, auto, mortgage, small business and personal lending customers who contact us, and we will continue to communicate with customers as the situation evolves," King said. He added that the Wells Fargo Foundation has committed up to $6.25 million in donations to sup- port both the domestic and global response to COVID-19 and to aid public health relief efforts. Funding includes $1 million for the National Centers for Disease Control and Prevention's Emergency Relief Fund and $250,000 to the International Medical Corps for their work in over 30 countries. King said Wells Fargo will also donate up to $5 million at the local level to help address community-specific needs in the coming months. "We recognize and appreci- ate the role of front-line health care providers as they apply their expertise on this fast-moving issue and care for the well-being of our communities," King said. Declining Rates in a Volatile Market A long with housing, the stock market is among the sec- tors of the U.S. economy being impacted by the coronavirus. The Federal Reserve emptied the pro- verbial chamber in recent weeks, dropping interest rates by 50-basis points in March. A few weeks later, the Fed took emergency action on March 15 and dropped interest rates even further—all the way to 0%. "The Committee expects to maintain this target range until it is confident that the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals," said the Fed following dropping rates to zero. "At issue is how much this inoculation can protect the economy and support the finan- cial markets from a public health crisis and supply constraints radi- ating out from China," Hamrick said. "While the statement from the FOMC says the fundamentals of the economy remain strong, central bankers are obviously concerned about developments yet to possibly unfold." Mark Hamrick,'s Senior Economic Analyst said the Fed delivered "monetary policy medicine" that investors were looking for following the econom- ic impacts of the virus. Hamrick said the drops by the Fed shows how serious the Fed believes the possible risks the virus poses to the economy. A result of falling interest rates: Falling mortgage rates. Freddie Mac's Primary Mortgage Market Survey from March 26 reported the average 30-year fixed-rate mortgage came in at 3.50%. Odeta Kushi, Deputy Chief Economist at First American, said the Fed's actions should help bol- SPECIAL REPORT: COVID-19 "The Fed's goal appears to be to limit the damage to their financial markets during the period that social distancing will lead to widespread disruption to economic activity." —Tendayi Kapfidze, Chief Economist, Lending Tree

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