Dozens of Connecticut banks and credit unions have agreed to extend their three-month grace period for residential mortgage payments through July.
Forbearance of up to 90 days and waiving of late fees, as well as a pledge to not initiate any new foreclosures, are part of a voluntary pact between lenders and the state’s banking regulator, first announced on March 31, meant to offer relief as the COVID-19 pandemic battered the state’s economy.
The agreement was initially going to expire after two months, but officials announced Thursday that it would run through July 30.
“By voluntarily agreeing to extend their participation in this initiative, Connecticut banks and credit unions have shown us that they once again stand ready to assist their customers and members during difficult times. This initiative is designed to provide relief for residents of the state who are feeling the economic impacts of COVID-19. We are all in this together and our financial institutions have shown they are partners to help get us through” said Commissioner Perez.
A total of 47 lenders — 31 banks and 16 credit unions — were signed onto the pact as of June 4, according to a regularly updated list on the state’s website.
That’s down from more than 60 that signed on back in early April.
The offer is not automatic. Mortgage borrowers must contact their lender to request relief, and may have to provide documentation proving their hardship.
The offer only applies to residential mortgages that are owned by the bank or credit union, known as portfolio mortgages.
It wasn’t clear Friday morning how many mortgages have received a forbearance since the program began in April. The announcement did not provide any figures, and a banking department spokesman said the agency didn’t have that information.
HBJ requested forbearance figures from the industry associations that represent Connecticut banks and credit unions, but had not received them as of Friday morning.