Senators to CFPB: Advertise Help for Homeowners

Not enough Americans hurt by COVID-19 know that the CARES Act included funding help for mortgage payments. The senators want a strong public awareness campaign.

WASHINGTON – Five U.S. senators on the Banking Committee wrote a letter to the Consumer Financial Protection Bureau (CFPB), saying there’s funding help for at-risk homeowners but too few know about it.

According to the senators – Sherrod Brown, Elizabeth Warren, Van Hollen, Robert Menendez and Jack Reed – surveys have shown a “significant amount of eligible borrowers are not aware of mortgage relief options, with even larger gaps among black and Hispanic borrowers.”

According to the senators, CFPB has a “duty and the authority to take actions that ensure families can stay in their homes and prevent a series of irreversible foreclosures.” But they say CFPB isn’t taking enough proactive steps to tell homeowners about available programs.

The CFPB outlines coronavirus aid information for homeowners on its website.

The Coronavirus Aid, Relief, and Economic Security (CARES) Act allows borrowers with federally backed mortgages the right to request a forbearance for up to one year. To do that, they must submit a request to their mortgage servicer and confirm that they’re experiencing “financial hardship during the COVID-19 emergency.”

“However, Fannie Mae’s National Housing Survey, released last month, found that 56% of borrowers surveyed that made less than $50,000 were not familiar with the mortgage relief options,” the senators wrote.

The senators suggested three steps CFPB should take:

1. Aggressively enforce existing regulatory requirements for servicers to notify borrowers of their options to avoid foreclosure if they’re in default.

2. Issue additional guidance to servicers, including a model notice, to specify the procedures servicers should take to notify borrowers of their available options before a borrower ends up in delinquency.

3. Mount a strong public awareness campaign about mortgage borrower relief options, with a specific goal to reach minority borrowers, borrowers with limited English proficiency and borrowers with household incomes of less than $50,000.

“As the pandemic-induced economic collapse enters its sixth month, homeowners who lost their jobs and are relying on unemployment benefits to make ends meet just had their weekly benefits cut in half,” the senators wrote. “It is essential that the Bureau use every single tool at its disposal to ensure these individuals … understand their options to keep their homes during this unprecedented global pandemic.”

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