COVID-19: Bankruptcy Risk for Nonbanks

Published: April 10, 2020, 2:40 a.m.

Forbearance will help save property owners who can\u2019t pay their mortgage, but who\u2019s going to save the mortgage service companies that have to pay the bond holders? Major players in the housing industry say that without a bailout, companies like Quicken Loans, Freedom Mortgage, Mr. Cooper, and other nonbank mortgage companies could have a serious liquidity problem. FHFA Director, Mark Calabria, doesn\u2019t agree. He says there\u2019s no evidence of a systemic failure among nonbanks. \xa0 The pandemic has triggered concerns about another foreclosure crisis because of all the job losses. That prompted the creation of a mortgage forbearance program for homeowners as part of the $2 trillion Cares Act. \xa0 www.NewsForInvestors.com