California Gov. Gavin Newsom recently announced a proposal that would create a more than $125 million mortgage relief program to assist homeowners whose homes were destroyed or severely damaged by recent natural disasters.
The California Housing Finance Agency (CalFHA) would administer the funding package that includes more than $100 million in direct mortgage assistance and $25 million to extend an existing program that provides mortgage counseling. The package would not impact the proposed 2025-2026 budget and would use existing mortgage settlement funding.
The program would apply to homeowners at risk of foreclosure after their properties were destroyed or significantly damaged since Jan. 1, 2023, as a result of declared emergencies.
“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,” Newsom said.
CalHFA considered the proposal at its Thursday meeting. Direct assistance program and eligibility criteria will be developed and announced if the proposal is approved.
Natural disasters since 2023 include the Park Fire, Franklin Fire, the Palisades and the Eaton Fires.
Five major mortgage lenders have committed to offering impacted homeowners a 90-day forbearance on mortgage payments.