Distressed

Treasury Secretary Steven Mnuchin reiterated Thursday that he wants U.S. financial markets to remain open even as the coronavirus fuels wild volatility, while adding that he's focused on helping mortgage firms expected to be hit hard by the pandemic’s spreading economic pain.

As real estate prices soared in recent years, working-class adults everywhere have increasingly relied on mortgages backed by the Federal Housing Administration — and U.S. taxpayers.

The Department of Housing and Urban Development's 60-day foreclosure halt for Federal Housing Administration borrowers is too short to help reverse mortgage borrowers, a letter from consumer groups stated.

Detroit-based mortgage giant Quicken Loans could be facing a cash crunch in coming weeks and possibly need temporary emergency federal assistance if lots of borrowers stop making payments on their home mortgages during the coronavirus pandemic, according to a news report.

The Federal Reserve Board should create a dedicated facility for mortgage servicers to access in order to make required advances, industry participants and observers, including its largest trade group, said.

The percentage of mortgages underwater — when a mortgage exceeds value — has decreased dramatically in South Florida since the Great Recession, meaning the region may be better prepared to weather COVID-19 than the downturn a decade ago.

While the mortgage market began the year healthy, lenders and borrowers need to prepare for the impacts of the coming coronavirus recession.

With increased economic distress because of the coronavirus, lenders are likely to see an increase of borrowers looking for a mortgage rescission, arguing they are eligible for an extended filing time frame.

New York Gov. Andrew Cuomo promised a 90-day moratorium on mortgage payments for financially strapped New Yorkers because of the coronavirus.

The Home Affordable Modification Program became a national blueprint for loss mitigation in the last crisis, but changes in the servicing landscape and circumstances call for a new approach now.