Effective Date: 07/01/00
Procedure Statement 13: Forbearance Transactions
Forbearance transactions should be used to place a borrower's account on a temporary repayment schedule. The renegotiated repayment plan must be approved by the Loan Officer.
- The loan officer renegotiates a minimum payment with the borrower making sure payment covers monthly interest amount and at least a penny of principal. Calculates number of months the account should remain in forbearance.
- Mails new repayment schedule to borrower with cover letter and files copies and other forbearance documentation in borrower's folder.