The FDIC has been quick to shoulder much of the losses in seizing the assets of failed banks and selling them off to other banks.
Now it wants something in return: a pledge from those acquiring banks to go easy on unemployed borrowers in danger of losing their homes.
Specifically, regulators on Friday directed institutions that have received federal aid in acquiring failed banks to "consider temporarily reducing mortgage payments for borrowers who are unemployed or underemployed."
Through signing forbearance agreements with those struggling borrowers, banks would give them time to find work and hopefully avoid an unnecessary foreclosure.
"With more Americans suffering through unemployment or cuts in their paychecks, we believe it is crucial to offer a helping hand to avoid unnecessary and costly foreclosures. This is simply good business since foreclosure rarely benefits lenders and would cost the FDIC more money, not less," Federal Deposit Insurance Corp. Chairman Sheila Bair said in a statement.
Ultimately, Bair said, the approach could help reduce the FDIC's losses as well.
The target of the directive are "loss-share" banks that have received federal help in acquiring failed banks. The biggest recent case affecting Floridians: BB&T, which acquired the assets of failed Colonial Bank last month in a deal that shifted much of Colonial's liabilities to the FDIC.
BB&T spokeswoman A.C. McGraw said the bank was reviewing the directive and had no further comment.
From the beginning of 2008 through August 2009, the FDIC has entered 53 loss-sharing agreements, with $80 billion in assets covered by the program. Under the new directive, those banks are asked to give borrowers at least six months to make reduced mortgage payments as they try to find employment.
"There's no question there could be cases where six months is not long enough ... but that's usually a reasonable period of time," said Michael Krimminger, a special adviser for policy in Bair's office.
Krimminger said the program addresses a fundamental shift in the nature of mortgage woes, from the subprime mortgage crisis to a crisis for homeowners with traditional mortgages who are having trouble paying.
"Earlier the problem was the structure of the loans. Increasingly it's an issue of people losing their jobs," he said. "It's pretty evident in the data we're seeing that delinquency rates of prime mortgages are going up much higher than people would have anticipated."
The directive is couched as a recommendation, but regulators say they expect compliance. "It would be early for me to tell you what the response is - though I suspect it will be widely supported," FDIC spokesman Andrew Gray said.
The FDIC's push gets to the heart of two of the biggest problems dogging the Tampa Bay area: high unemployment and a high number of foreclosures. In July, the bay area unemployment rate stood at 11.3 percent. Though the number of area foreclosures dropped 14 percent between July and August, foreclosure and pre-foreclosure homes still constituted close to 40 percent of sales this summer.
As part of their loss-share agreements, buyers of failed FDIC-insured banks already must abide by the agency's mortgage loan modification program. But increasingly, borrowers have been unable to meet certain income criteria to get their loans modified.
Borrowers are supposed to meet what's known as a "net present value" test, a measurement of whether they have the income stream to support paying a modified payment for the life of the loan. Those who can't pass the test, including many who are out of work, could face foreclosure.
Krimminger said some banks are more willing than others to offer forbearance agreements. "What we're going to hold them to is making choices to help. ... (This program) offers a helping hand to people who are in dire straits through no fault of their own."
Jeff Harrington can be reached at firstname.lastname@example.org or (727) 893-8242.