Expanded Authority of Lenders to Enter

The CARES Act established the authority of the U.S. Department of Treasury, the Farm Credit Administration, and other federal financial regulatory agencies to authorize bank and non-bank lenders to participate, including insured credit unions in loans made under the Paycheck Protection Program. For financial institutions under this section, Treasury has authority to issue regulations and guidance for terms concerning lender compensation, underwriting standards, interest rates, and maturity. Interest rates set under this authority may not exceed the maximum permissible rate of interest set on loans made under Section 1102 of this Act.

Debt Guarantee Authority

Authorizes Federal Deposit Insurance Corporation (“FDIC”) to temporarily establish a debt guarantee program for solvent insured depositories and depository institution holding companies. Noninterest-bearing transaction accounts may be treated as a debt guarantee program. Authorizes National Credit Union Administration (“NCUA”) to temporarily increase share insurance coverage for noninterest-bearing transaction accounts. Such authorities, programs, guarantees, and increases shall terminate no later than December 31, 2020.

Temporary Lending Limit Waiver

Temporarily provides non-bank financial companies an exception to the office of the Comptroller of the Currency’s lending limits aligned with exception for financial companies, and temporarily authorizes Comptroller of the Currency to exempt any transaction from the lending limits, if the exemption is in the public interest. The temporary exemption from lending limits and authorization to exempt transactions expires at the earlier of December 31, 2020, or the date on which the national emergency declaration related to coronavirus is terminated.

Temporary Relief for Community Banks

Requires Federal banking agencies to temporarily – by interim rule – reduce the Community Bank Leverage Ratio (“CBLR”) for qualifying community banks from 9 percent to 8 percent, and provide for a reasonable grace period if a community bank’s CBLR falls below the prescribed level. The interim rule expires at the earlier of December 31, 2020, or the date on which the national emergency declaration related to coronavirus is terminated.

Temporary Relief from Troubled Debt Restructurings

A financial institution may elect to suspend requirements under U.S. Generally Accepted Accounting Principles for loan modifications related to the coronavirus pandemic, and suspend any such determination regarding loans modified as a result of the effects of the coronavirus. Federal banking agencies and the NCUA must defer to a financial institution to make a suspension. Such election may begin on March 1, 2020 and last no later than 60 days after the lifting of the coronavirus national health emergency.

Optional Temporary Relief from Current Expected Credit Losses

An insured depository institution (including a credit union), bank holding company, or any of its affiliates has the option to temporarily delay measuring credit losses on financial instruments under the new Current Expected Credit Losses methodology. Such option to delay expires at the earlier of December 31, 2020, or the date on which the national emergency declaration related to coronavirus is terminated.

Non-Applicability of Restrictions on ESF During National Emergency

Temporarily suspends the statutory limitation on the use of the Exchange Stabilization Fund (Section 131 of the Emergency Economic Stabilization Act of 2008) for guarantee programs for the United States money market mutual fund industry. Any guarantee shall be limited to the total value of a shareholder’s holdings in a participating fund as of the close of business on the day before the announcement of the guarantee. Any guarantee established as a result of the application of this Section shall terminate not later than December 31, 2020.

Temporary Credit Union Provisions; Expanding Liquidity

Temporarily enhances access to the Central Liquidity Facility, including for corporate credit unions, to meet liquidity needs. Increases resources available to meet liquidity needs through the Facility. The amendments provided under this section sunset on December 31, 2020.

Increasing Access to Materials Necessary for National Security and Pandemic Recovery

Waives for two years the requirement for a separate act of Congress to authorize certain projects exceeding $50 million and the requirement that any amounts unused in the Defense Production Act Fund at the end of the fiscal year that exceed $750 million be swept and returned to the Treasury’s General Fund. This Section also waives for one year following enactment the requirement for a 30-day layover after Presidential notification to Congress before a project may start and the requirement that Congress separately authorize certain projects exceeding $50 million in aggregate cost.

Foreclosure Moratorium and Consumer Right to Request Forbearance

Prohibits foreclosures on all federally-backed mortgage loans for a 60-day period beginning on March 18, 2020. Provides up to 180 days of forbearance for borrowers of a federally-backed mortgage loan who have experienced a financial hardship related to the COVID-19 emergency. Applicable mortgages included those purchased by Fannie Mae and Freddie Mac, insured by HUD, VA, or USDA, or directly made by USDA. The authority provided under this section terminates on the earlier of the termination date of the national emergency concerning the coronavirus or December 31, 2020.

Forbearance of Residential Mortgage Loan Payments for Multifamily Properties with Federally Backed Loans

Provides up to 90 days of forbearance for multifamily borrowers with a federally backed multifamily mortgage loan who have experienced a financial hardship. Borrowers receiving forbearance may not evict or charge late fees to tenants for the duration of the forbearance period.

  • Applicable mortgages include loans to real property designed for 5 or more families that are purchased, insured, or assisted by Fannie Mae, Freddie Mac, or HUD.
  • The authority provided under this section terminates on the earlier of the termination date of the national emergency concerning the coronavirus or December 31, 2020.

Temporary Moratorium on Eviction Filings

For 120 days beginning on the date of enactment, landlords are prohibited from initiating legal action to recover possession of a rental unit or to charge fees, penalties, or other charges to the tenant related to such nonpayment of rent where the landlord’s mortgage on that property is insured, guaranteed, supplemented, protected, or assisted in any way by HUD, Fannie Mae, Freddie Mac, the rural housing voucher program, or the Violence Against Women Act of 1994.