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Financial regulators encourage shutdown assistance
Financial industry regulators, including the NCUA, are encouraging institutions they supervise to find ways to help borrowers that are affected by the ongoing partial government shutdown. Credit unions are already offering products and services to support members whose pay might be impacted by the shutdown.
The regulators noted that individuals may have a hard time making payments on mortgages, student loans, car loans, business loans and credit cards.
"As they have in prior shutdowns, the agencies encourage financial institutions to consider prudent efforts to modify terms on existing loans or extend new credit to help affected borrowers," the regulators said. "Prudent workout arrangements that are consistent with safe-and-sound lending practices are generally in the long-term best interest of the financial institution, the borrower, and the economy. Such efforts should not be subject to examiner criticism."
Immediately after the shutdown began, scores of credit unions began offering members that have been furloughed or affected by the shutdown access to various programs and services. Some of the services include one-time loans to those whose pay will be disrupted, line-of-credit limit increases, deferred payments on existing loans, and short-term, reduced rate loans to help meet expenses during the shutdown, to name a few.
The regulators, which include the NCUA, Bureau of Consumer Financial Protection, Federal Reserve, Conference of State Bank Supervisors, Federal Deposit Insurance Corporation and Office of the Comptroller of the Currency, also encouraged consumers to reach out to their financial institution to see what kind of assistance may be available.