Governor Gavin Newsom Announces Major Financial Relief Package: 90-Day Mortgage Payment Relief During COVID-19 Crisis

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Governor Newsom announces financial institutions will provide relief for vast majority of Californians 

 

Californians economically impacted by COVID-19 may receive 90-day grace periods to make mortgage payments

 

 Financial institutions agree not to negatively impact credit reports as a result of accepting payment relief

 

SACRAMENTO – Governor Gavin Newsom today announced that financial institutions will provide major financial relief for millions of Californians suffering financially as a result of the COVID-19 outbreak.

“Millions of California families will be able to take a sigh of relief,” said Governor Newsom. “These new financial protections will provide relief to California families and serve as a model for the rest of the nation. I thank each of the financial institutions that will provide this relief to millions of Californians who have been hurt financially from COVID-19.”

Governor Newsom secured support from Citigroup, JPMorgan Chase, U.S. Bank, and Wells Fargo and nearly 200 state-chartered banks, credit unions, and servicers to protect homeowners and consumers.

Under the Governor’s proposal, Californians who are struggling with the COVID-19 crisis may be eligible for the following relief upon contacting their financial institution:

 

90-Day Grace Period for Mortgage Payments

Financial institutions will offer, consistent with applicable guidelines, mortgage payment forbearances of up to 90 days to borrowers economically impacted by COVID-19. In addition, those institutions will:

  • Provide borrowers a streamlined process to request a forbearance for COVID-19-related reasons, supported with available documentation;
  • Confirm approval of and terms of forbearance program; and
  • Provide borrowers the opportunity to request additional relief, as practicable, upon continued showing of hardship due to COVID-19.

No Negative Credit Impacts Resulting from Relief

Financial institutions will not report derogatory tradelines (e.g., late payments) to credit reporting agencies, consistent with applicable guidelines, for borrowers taking advantage of COVID-19-related relief.

Moratorium on Initiating Foreclosure Sales or Evictions

For at least 60 days, financial institutions will not initiate foreclosure sales or evictions, consistent with applicable guidelines.

Relief from Fees and Charges

For at least 90 days, financial institutions will waive or refund at least the following for customers who have requested assistance:

  • Mortgage-related late fees; and
  • Other fees, including early CD withdrawals (subject to applicable federal regulations).

Loans held by a financial institution may be serviced by another company.

Please note that financial institutions and their servicers are experiencing high volumes of inquiries.

 

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6 Comments

  1. Charles Root

    What about renters?
    My wife and I rent a home and I am off work as a substitute teacher and unemployment system has been too busy for me to proceed.

    Reply
    • Myrna Harrison

      Reach out to your landlord. They can RECEIVE a forgivable loan and also pass on some relief to their tenant. SBA Economic Injury Disaster Loan

      Reply
  2. Alan Harris

    Do banks have a loophole where they will not allow me in the program because I have commercial property loans? Corp tenants have notified me that they will not pay the next 3 months so there is no rent to pay the mortgage and then the banks can steal my property and in the big picture if commercial property goes under then there will be a huge deflationary spiral that breaks the foundation of our economy. My residential tenants have protections but how can I maintain where they live if I cannot even pay the single biggest expense of my mortgage. They would be impacted the most also.

    Reply
  3. susan

    Do the homeowners asking for this money realize, they have to pay it back in 90 Days. Do the renters realize the homeowner have to pay it bake in 90 days if they qualify. Which few do.

    Reply
    • ALAN HARRIS

      Some banks are adding to the mortgages on the back end extending the term without penalty.

      Reply
  4. Matthew StPierre

    When will we see the extra 600 in our unemployment checks and the extensions???

    Reply

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