California Lawmakers Push for Mortgage Relief Bill After Wildfires

U.S. Reps. Judy Chu and Brad Sherman introduced the Mortgage Relief for Disaster Survivors Act, which would provide up to a year of forbearance on federally backed mortgages in declared disaster zones.

The bill is inspired by the Eaton and Palisades fires and mirrors aspects of the CARES Act mortgage forbearance program.

Homeowners could receive a six-month pause on mortgage payments, with a possible six-month extension, without incurring interest, penalties, or fees.

The bill seeks to standardize forbearance policies for federal lenders, addressing the gap where nonfederal lenders aren't required to offer such relief.

Mortgage Forbearance:: The bill mandates a six-month pause on mortgage payments for homeowners with federally backed loans in areas with a federal disaster declaration. An additional six-month extension is possible.

No Penalties:: Homeowners would not accrue interest, penalties, or fees during the forbearance period.

Inspiration from CARES Act:: The bill is modeled after the mortgage forbearance clause in the CARES Act, which provided similar relief during the COVID-19 pandemic.

Understand Your Mortgage Options:: Familiarize yourself with forbearance policies offered by your lender.

Document Everything:: Keep detailed records of property damage and communication with insurance companies and FEMA.

Stay Informed:: Monitor local and federal resources for disaster relief programs.

Q: What is mortgage forbearance?

Q: Who is eligible for this mortgage relief?

Q: Will I have to pay interest or fees during the forbearance period?

The Mortgage Relief for Disaster Survivors Act aims to provide immediate financial relief to homeowners affected by natural disasters.

The bill offers a six-month pause on mortgage payments, with a possible six-month extension, without penalties.

This legislation is inspired by the CARES Act and seeks to standardize forbearance policies for federal lenders.