June 05, 2020

Warren, Brown, Menendez Urge Senate Leadership to Include Additional Protections to Help Homeowners Survive the COVID-19 Crisis

Senators Release Results of Mortgage Servicer Inquiry That Reveal Gaps in CARES Act Implementation that Could Result in Significant Harm to Homeowners

Letter to Senate Leadership

Washington, DC -- United States Senators Elizabeth Warren (D-Mass.), Sherrod Brown (D-Ohio), and Bob Menendez (D-N.J.) wrote to Senate leadership about the information they received as part of their inquiry into mortgage servicers' practices during the current crisis. As a result, they are urging leaders to include additional protections for homeowners in any upcoming coronavirus disease 2019 (COVID-19) relief legislation.

On April 20, 2020, Senators Warren, Brown, and Menendez and six of their colleagues wrote to eleven major mortgage servicers requesting information on how servicers are ensuring homeowners facing economic hardship during the COVID-19 pandemic are able to take advantage of the foreclosure and forbearance protections included in the Coronavirus Aid, Relief, and Economic Security (CARES) Act. 

This inquiry revealed that while mortgage servicers are taking steps to comply with homeowner protection provisions guaranteed in the CARES Act, there remain gaps in their implementation, as well as issues that were unaddressed by the CARES Act, that could result in significant harm to homeowners.

Based on the findings of their inquiry, the lawmakers are calling for the following critical protections for all homeowners to be included in any upcoming COVID-19 relief legislation: 

  1. An extension and expansion of foreclosure and forbearance protections created by the CARES Act, including a requirement for sustainable repayment options after forbearance; 
  2. Automatic forbearance enrollment;
  3. An extended moratorium on foreclosures to avoid the "foreclosure cliff";
  4. Safeguards from harmful credit reporting related to missed or late mortgage payments; and
  5. Requirements that mortgage servicers proactively and clearly notify homeowners of their available foreclosure and forbearance protections.

"The Health and Economic Recovery Omnibus Emergency Solutions Act (HEROES Act), recently passed by the House of Representatives, includes many of these additional protections for homeowners," the lawmakers wrote. "We encourage the Senate to adopt these measures, and where necessary, encourage you to go further in adopting additional safeguards that our inquiry of major mortgage servicers' practices reveals to be necessary to help homeowners survive this crisis."

Since the beginning of the coronavirus outbreak, Senator Warren has pressed the Trump Administration to respond effectively to deliver the robust set of resources needed to address this public health emergency, including mortgage, foreclosure, and eviction relief for homeowners and renters. Senator Warren published a Medium post with Senator Brown pushing for consumer debt protections, including expanded and extended forbearance and foreclosure moratorium for homeowners. She cosponsored legislation to provide $100 billion for an emergency rental assistance fund to help renters remain safely in their homes  She also cosponsored a bill with Senator Brown that would fill the gaps in the CARES Act relief by instituting a more comprehensive suspension of mortgage and other debt collection. She also wrote to the credit reporting agencies with Senator Brian Schatz (D-Hawai'i) to gain more information on how COVID-19-related defaults were harming consumer credit.