In the wake of recent Californian firestorms, Governor Gavin Newsom has put forth a proposal for a substantial mortgage relief program valued at over $125 million. This initiative is crafted to aid those homeowners grappling with the substantial damages or total loss of their homes due to disastrous natural events since 2023, leaving them vulnerable to possible foreclosure. According to a statement obtained by the Governor's office, the plan also encompasses funding that would prolong the availability of mortgage counseling services, thereby assisting homeowners in mapping their path to recovery.
The proposed relief bundle would deploy existing mortgage settlement funds, ensuring no impact on the state's 2025-2026 budget plans. More than $100 million is earmarked for direct mortgage aid, with an additional $25 million set to reinforce the current program that offers mortgage counseling, as well as guidance surrounding FEMA disaster aid and other similar necessities. "As survivors heal from the trauma of recent disasters, the threat of foreclosure should be the last thing on their minds. This disaster mortgage relief program would help lift this burden and give families more time to focus on recovery," Governor Newsom highlighted.
This initiative is aimed towards homeowners confronted with foreclosure risks, whose properties were demolished or incurred considerable damage owing to emergencies declared post-January 1, 2023. The eligible disasters cited cover the Park and Franklin Fires along with the more recent Palisades and Eaton blazes. The California Housing Finance Agency (CalFHA) will manage the package, with detailed program specifics and eligibility requirements to be fleshed out following approval at CalHFA's meeting scheduled for February 20.
Complementing this mortgage relief plan, Governor Newsom announced last month that five substantial lending entities—Bank of America, Citi, JPMorgan Chase, U.S. Bank, and Wells Fargo—have pledged a 90-day mortgage payment forbearance for homeowners affected by the fires. Such leniency will not reflect negatively on homeowners' credit reports. Moreover, an incremental 420 state-chartered banks, credit unions, and mortgage lenders are poised to offer further relief, as the Governor underscored.
Governor Newsom's efforts extend beyond mortgage assistance: tax relief measures for Los Angeles County have been implemented, like postponing the individual tax filing deadline to October 15 and extending the sales and use tax filing deadline to April 30, 2025. Additionally, Newsom has taken measures to expedite rebuilding processes, secure temporary housing, and shield fire victims from unethical pricing practices during their vulnerable times of need.
