Gov. Andrew Cuomo on Saturday evening released Executive Order 202.9, which codifies with the force of law some of the mortgage relief measures previously announced and put out by the state Department of Financial Services through guidance. The provisions went into effect Saturday night through April 20, 2020.
“It is important to note that the governor’s executive order addressing mortgage relief are enforceable only against state-chartered credit unions,” explained William J. Mellin, president/CEO of the New York State Credit Union Association. “However, the fact is, the vast majority of consumer members don’t understand that. This, of course, will lead to many calls and many questions. Only you, your board, and your financial position, can decide on how to respond.”
The executive order codifies subdivision two of section 39 of the Banking Law, providing that it “be deemed an unsafe and unsound business practice” if, in response to the COVID-19 pandemic, any state-chartered financial institution fails to grant a forbearance for 90 days to any person or business who has a financial hardship as a result of the COVID-19 pandemic.
The executive order, which applies to both individuals and businesses, also directs the New York Department of Financial Services to ensure that consumers facing financial hardship because of COVID-19 are given the opportunity to forbear mortgage payments under “reasonable and prudent” circumstances.
The DFS will also promulgate emergency regulations to require the forbearance application be made widely available for consumers, and require the application to be granted in all reasonable and prudent circumstances solely for the period of the emergency.
Regarding fee waivers, the DFS is empowered to promulgate emergency regulations to direct that, solely for the period of the emergency, ATM fees, overdraft fees and credit card late fees may be restricted or modified in accordance with the regulation of licensed or regulated entities, taking into account the financial impact on the state’s consumers, safety and soundness, and applicable federal requirements.
To view the executive order, click here.