May 05, 2020

Cortez Masto Calls on FHA Commissioner Nominee to Protect Homeowners from Bad Lenders, Raise Awareness of Forbearance Options

Senate Banking Remote

Washington, D.C. – During a hearing of the Senate Banking Committee, U.S. Senator Catherine Cortez Masto (D-Nev.) questioned Federal Housing Administration (FHA) Commissioner nominee Dana Wade about her plans to protect homeowners from bad mortgage servicers and raise awareness of forbearance options that would allow struggling Americans to remain in their homes.

In her questioning, Senator Cortez Masto recalled home loan servicers’ failure to engage in loss mitigation during the 2008 financial crisis, and stressed that servicers were again failing to provide borrowers with critical information that would allow them to avoid foreclosure.

“Last week, the HUD Office of Inspector General published another report on its review of 30 FHA servicers’ websites, and the report found that the servicers’ websites provided incomplete, inconsistent data and unclear guidance to borrowers related to their forbearance options under the CARES Act. Servicers should obviously not be providing this type of misinformation. It is conduct that I worked so hard as Attorney General – so many of us did – to correct, prevent, and we're seeing it again. So my question to you is, how will you ensure that servicers provide clear and fair guidance on forbearance to homeowners and prevent this type of bad conduct from occurring during this crisis?” asked Senator Cortez Masto.

“To your point, specifically, about ensuring that servicers are communicating right policies to homeowners, that is also a priority. Again, this can be a confusing time it is an uncertain time. And if confirmed I would do whatever I could do to ensure that there was as much clarity there as possible,” responded Wade, adding that the issue should be “monitored vigilantly.”

Senator Cortez Masto ended her questioning of Wade and Special Inspector General for Pandemic Recovery nominee Brian Miller by thanking them and issuing this warning:

“Too many people are still suffering, and we're looking for people to stand up and do the right thing here. I appreciate your willingness to work, quite honestly, in this administration, with everything that's going on, but we're going to hold you accountable. At the end of the day, I'm hopeful that I get to work with most of you, but we're going to ask the tough questions. I am not going to let up; it is too important that we address the suffering that is happening across this country.”

Full video of this exchange is available here.