www.cnbc.com   (Author: Darla Mercado)

Some major banks are offering assistance to help customers who are affected by the government shutdown.
Congress and President Donald Trump have been at a standoff over funding for a border wall. In all, about 800,000 federal employees are expected to be furloughed or working without pay.
Affected workers are already grappling with incoming bills. The U.S. Office of Personnel Management’s verified Twitter account posted sample letters for federal workers to use with landlords and creditors as they seek relief for payments.


Several banks have stepped up to provide federal employees with help through existing consumer assistance programs.
Wells Fargo said it will consider reversing overdraft fees for customers whose income has been disrupted due to the shutdown. Further, mortgage, loan and credit consumers may qualify for forbearance or other payment assistance programs.
What exactly consumers can qualify for will depend on their individual circumstances, said Tom Goyda, a spokesman for Wells Fargo. Click here for more information on the bank’s program.
Bank of America has also offered some help for affected clients.
“Our Client Assistance Program is available and designed to help clients experiencing financial hardship,” said spokesman Lawrence Grayson.
The relief that consumers can receive will depend on the particulars of their situations, but may include fee waivers, loan modifications and more, he said. Consumers can call the bank’s assistance line at (844) 219-0690.
Chase, the consumer banking arm of JPMorgan Chase & Co., said it would assist clients affected by the shutdown, encouraging them to call its special care line at 1-888-356-0023.
Citi has also said that it’s offering assistance for clients facing hardship.
Click here for a list of federal agencies and their contingency plans amid the shutdown.
Here’s how federal workers can shore up their finances and get through any lean times ahead.

Get on the phone. 

Get in touch with the federal agency you work for to determine whether you are being furloughed and find out what resources are available.
In some cases, federal credit unions are offering furlough relief loans to help affected workers remain afloat in the short-term.
For instance, the Congressional Federal Credit Union has a relief line of credit with an initial rate of 0 percent for 60 days. After that, the rate on the remaining balance is 4 percent.

Tighten your budget.

If you’re about to be less flush this month, draw up your monthly budget and see what you can slash during the shutdown, said Marguerita M. Cheng, a certified financial planner and CEO of Blue Ocean Global Wealth in Gaithersburg, Maryland.
If you have outstanding loans, including mortgages and student debt, be sure to contact your creditors to make them aware of your situation.
“Most agencies also have a process in place for employees that they can use to reach out to creditors and landlords to ask for some relief,” said Patrick Amey, a CFP at Aspyre Wealth Partners in Overland Park, Kansas.

Tap emergency cash.

If you’re unsure about your next paycheck, this is the time to turn to your emergency fund as a backstop.
The standard rule of thumb is to maintain enough cash to cover three months to six months of expenses, said Bryan Beatty, a CFP and partner at Egan Berger & Weiner in Vienna, Virginia.

The next best alternative could be a zero-interest furlough loan or line of credit from a federal credit union, Beatty said. Remember, the zero-interest period runs for a limited time — typically up to 60 days.
If you already have a home equity line of credit open and available for draw-down, this might be a potential source of emergency funding.
Consider that the average rate on a so-called HELOC is 5.64 percent, compared with the average credit card rate of 17.56 percent, according to Bankrate.com.
The downside of taking out a HELOC is that the interest rates tend to be variable. Further, if you’re using the line of credit for purposes other than renovating your home, you won’t be able to deduct the interest on your taxes.

Avoid using this money if you can.

Not all pots of cash are there for the taking.
For instance, a loan from your retirement plan would put a dent in your long-term savings. You’ll also need to repay the cash or face taxes on the amount you borrowed.
Another source of cash to avoid would be credit cards and cash advances. Interest rates exceed 17 percent on credit cards, while cash advances could have up to 5 percent in additional charges, according to MagnifyMoney.
Finally, margin loans — in which you borrow from your brokerage account — could deal a significant blow to your finances.
That’s because your brokerage firm will require you to maintain a minimum balance in your account when you borrow against your investments. In the event of a sharp market decline, your balance could fall below the required minimum.
In that case, your brokerage firm will make a margin call and you could have less than 24 hours to deposit even more cash into your account or else the firm will sell your holdings.



https://www.cnbc.com/2019/01/02/wells-fargo-bank-of-america-to-assist-clients-amid-shutdown.html

www.housingwire.com   (Author: Ben Lane)

The federal government is asking the mortgage industry to help unpaid federal workers and contractors with their mortgage payments because they may not be able to make those payments due to the government shutdown.
The Federal Housing Administration announced late Tuesday that it is calling on all approved mortgagees and lenders to be “sensitive to the financial hardships experienced by borrowers as a result of the shutdown,” including borrowers who are subject to furlough, layoff, or a reduction in income due to the shutdown. 
Newly released data from Zillow shows that federal employees who own homes make about $249 million in mortgage payments each month. The Zillow report did not disclose how many of those have mortgages that are insured by the FHA, but the number is certainly greater than zero.
As such, the FHA is asking the mortgage industry to aid federal workers who aren’t getting paid right now because the government is shut down over funding for President Donald Trump’s border wall.
The FHA sent a letter Tuesday to mortgagees and lenders, reminding them of their “ongoing obligation to offer special forbearance to borrowers experiencing loss of income,” even if that loss of income is from the government itself.
“In accordance with longstanding policy, FHA expects mortgagees to assist borrowers experiencing a loss of income,” FHA Commissioner Brian Montgomery said in the letter.
The FHA said that it expects the mortgage industry to “make every effort to communicate with and assist affected borrowers to the greatest extent possible,” in at least the following ways:

• Extending special forbearance plans to borrowers impacted by the shutdown
• Fully evaluating borrowers for available loss mitigation options to avoid foreclosure whenever possible

Beyond that, the FHA said that it is also “strongly encouraging” all approved mortgagees and lenders to waive any late fees for affected borrowers along with suspending credit reporting on borrowers who have been affected by the shutdown.
To read the FHA’s full letter to the mortgage industry, click here.

https://www.housingwire.com/articles/47875-fha-asks-mortgage-industry-to-help-unpaid-federal-workers-with-their-mortgages

Nearly 400 Wells Fargo customers lost their homes when they were accidentally foreclosed on after a software glitch denied them the ability to modify their mortgages as they sought federal aid, the bank disclosed in a regulatory filing late Friday.
The bank apologized and has set aside $8 million to compensate those affected by the glitch, which occurred from 2010 to 2015.
"During the course of an internal review, we determined that an automated calculation error may have affected the decision on whether or not to offer or approve some mortgage modifications between April 13, 2010 and Oct. 20, 2015, when the error was corrected," Tom Goyda, senior vice president of Wells Fargo said in a statement to the Business Times. "We're very sorry that this error occurred and are providing remediation to the approximately 625 customers who may have been impacted."

Wells Fargo said the software mistake miscalculated customers' eligibility for mortgage modifications. The error caused about 625 customers to be denied loan modifications they sought from a federal program to help homeowners avoid foreclosures.
While those amounts may seem small, considering Wells originated nearly $95 billion in mortgages in 2017 and is the largest mortgage servicer in the U.S., Wells is still grappling with public trust issues since September 2016, when it revealed a settlement with banking regulators over creating 3.5 million phantom accounts without customers' knowledge, in order to meet company sales targets. The bank agreed to pay $185 million in penalties and $5 million to customers in that case and then fired 5,300 people over the scandal, including the ouster of its CEO and several top executives in consumer banking. But then the cavalcade of scandals didn't stop there.
Just last week, in a separate settlement with the U.S. Justice Department, Wells Fargo, the second-largest mortgage agreed to pay a $2.1 billion fine for issuing loans it knew were based on false income information.
Wells Fargo is operating under a Federal Reserve cap on asset growth, placed by former Fed Chairman Janet Yellen before she left office in February. The Fed ordered Wells to fix control and compliance problems involving misleading sales practices in consumer banking. Separately, the Justice Department and the Securities and Exchange Commission are investigating its wealth management division. The bank said it paid $114 million to refund wealth management customers who had been overcharged in the last seven years, and $171 million for foreign-exchange clients.
Last year, Wells Fargo & Co. disclosed that it charged 570,00 auto-loan borrowers for insurance they did not ask for or need. That practice ran from 2012 to 2017. About $80 million was set aside by the bank for refunds and to compensate victims.

https://www.cnbc.com/2018/08/07/wells-fargo-accidentally-foreclosed-on-hundreds-of-homeowners.html