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Fed says it will provide financing against new U.S. ‘payroll protection’ loans

WASHINGTON (Reuters) – The Federal Reserve on Monday moved to bolster a new small-business lending program by allowing banks to turn those loans over to the U.S. central bank for cash, easing concerns among banks about getting stuck holding the low interest loans. The Fed said it would announce details later this week of a new term financing arrangement for loans made under what is known as the Payroll Protection Program, part of the federal response to the economic effects of the coronavirus pandemic.

Bank of America sees booming rescue loan demand, with applications for nearly 10% of program

Bank of America said Monday that it’s seen fierce demand for emergency rescue loans with current applications already accounting for nearly 10% of the entire amount allocated by Congress. The bank confirmed that it has received applications from 177,000 small businesses for a total of $32.6 billion in financing. The current Bank of America numbers are its applications and do not represent the sums the Small Business Administration has approved.

Ex-CFPB director urges agency to ‘act immediately’ to help consumers during pandemic

Former Consumer Financial Protection Bureau (CFBP) Director Richard Cordray on Monday outlined a number of steps that the agency should promptly take to help consumers during the coronavirus pandemic. In a white paper posted on Medium, Cordray and two other former CFPB officials argued that the agency currently “has been proceeding as if it is oblivious of the new and urgent risks facing consumers.”

Small business owners stuck in loan limbo as new government programs stumble

Small business owners say they are frustrated with the rollout of coronavirus loan programs that promised quick cash but have become mired in technical and regulatory snafus“It’s super confusing,” said Lance Lawson, co-owner of Space519, a clothing and retail boutique in Chicago. “We have real bills to pay, and I want to get my employees back on. They’re all on unemployment. Every day counts.”

Attorney General Becerra Issues Consumer Alert Urging Tenants Affected by COVID-19 to Act Fast in Order to Exercise their Rights

SACRAMENTO – California Attorney General Xavier Becerra today issued guidance to California tenants, urging them to act fast if they will not be able to pay their full rent as a result of the COVID-19 pandemic. This alert follows Governor Gavin Newsom’s executive order issued at the end of March that allows tenants affected by COVID-19 to delay their eviction process. Attorney General Becerra urges tenants to act quickly if they want to preserve their rights under the new executive order.

Governor Hogan Announces Financial Relief Initiatives for Marylanders and Small Businesses, Accelerates Hospital Surge Plan

ANNAPOLIS, MD—Governor Larry Hogan, in collaboration with Maryland’s financial institutions, today announced a series of financial relief initiatives to provide further assistance to millions of Marylanders and small businesses who are facing economic hardships due to COVID-19. Nearly 70 of Maryland’s largest banks, credit unions, mortgage lenders, state agencies, and other financial entities have collaborated to provide additional flexibility to borrowers.

VA says it will pause debt collection, extend benefits deadlines during coronavirus

The Department of Veterans Affairs plans to pause debt collection from veterans and extend benefits deadlines during the coronavirus pandemic. 

The move is intended to provide relief to veterans during the crisis, VA officials said. It follows President Donald Trump‘s announcement that he had directed VA to do exactly that. Previously, members of Congress called on VA to postpone debt collection and provide flexibility for benefits claims. 

Credit unions are ‘going to see auto lending die’ because of coronavirus

Auto lenders are bracing for one of their largest hits ever because of the coronavirus.

Car loans are a significant source of revenue for credit unions, making up about a third of the industry’s $1.1 trillion in loans in the fourth quarter, according to the National Credit Union Administration’s 2019 annual report.

Because of that, the anticipated slowdown related to the current pandemic is likely to inflict a certain amount of pain on a large number of credit unions.

Coronavirus mortgage bailout: ‘There is going to be complete chaos,’ says industry CEO

A broad coalition of mortgage and finance industry leaders on Saturday sent a plea to federal regulators, asking for desperately needed cash to keep the mortgage system running, as requests from borrowers for the federal mortgage forbearance program are pouring in at an alarming rate.

Consumers were slammed in the Great Recession. The CFPB’s former director warns worse could be on the way.

Cordray, who headed the CFPB under President Barack Obama and resigned in November 2017, told Vox he is particularly concerned that Americans will lose their homes and fall victim to the finance industry’s most predatory practices, just as they did during the 2008 economic crisis.

He doesn’t want that to happen again — and is pressing the CFPB’s current leadership to take action before it’s too late. Monday, he released a Medium post outlining immediate actions the bureau can take to address the coronavirus crisis and make sure the American people are protected from the myriad ways they are financially vulnerable right now.