With the nation’s unemployment rate still high, federal regulators are intensifying efforts to curb the effects of job losses or underemployment before they fuel another wave of home foreclosures.
The Federal Deposit Insurance Corp., which protects consumer deposits when banks fail, recently recommended that lenders provide certain borrowers with a temporary respite from mortgage payments, or a forbearance. That relief would last up to six months, and sometimes longer, as the lenders work on long-term loan modifications.
The plan, announced in September, applies only to the 53 financial institutions that relied on the FDIC’s insurance fund while acquiring failed banks. It does not include the four major mortgage lenders: Wells Fargo, Bank of America, Citigroup and JPMorgan Chase. Those banks already have unemployment forbearance programs, though they differ from the FDIC plan.
Bob Tedeschi, The New York Times
