It entirely depends on the loan servicer, but from my experience, the practice has always been to go through each borrower and examine their financials like already described.

No doubt that some people “slip through the cracks” but it’s more common for loans to just not get re-worked when there’s a shortage of staff. Successful loan servicing companies are beefing up their staff on loan work-outs to satisfy demand. Remember, the bank’s bottom line is $. Taking a shortage unnecessarily on someone who can make the payments hurts them as much as making a forbearance agreement with someone who still won’t be able to pay.