New Relief Available for Californians Struggling with Mortgage Payments

California Mortage Payment

California Mortgage Relief program is broadening its reach to help more homeowners who have defaulted on their payments during the pandemic. The program officials announced that aid would now be extended to three new groups: homeowners who have a mortgage on a “partial claim” or deferral, those who have missed a second mortgage payment after June 2022, and those who have a primary residence that includes up to four units. The program is also offering more assistance to homeowners who had previously received help from the state. One reason for the expansion is that the state has yet to spend most of the $1 billion in homeowner assistance that the federal government provided last year under America’s bailout plan. So far, only about 10,500 households have received an average of $28,137 from the program, for a total of nearly $300 million. To be eligible for the Mortgage Relief Program, households must earn up to 150% of the median income in their county and be experiencing financial hardship due to the pandemic. The program offers up to $80,000 for past due mortgage payments and up to $20,000 for missed property tax payments.

The state’s Mortgage Relief Program is now offering aid to homeowners who have a mortgage on a “partial claim” or deferral. Partial claims are a technique to help people who are at risk of losing their homes after missing multiple monthly payments on a loan backed by the Federal Housing Administration, the U.S. Department of Agriculture, or the Department of Veterans Affairs. The agencies split the overdue amount into a second, interest-free mortgage to allow borrowers to stay current by paying their usual monthly payment. The state’s Mortgage Relief Program is now offering up to $80,000 to pay for all or part of a COVID-related partial claim or forbearance.

Similarly, some lenders offered deferrals, in which the defaulted payments were bundled into one sum that was pegged to the end of the loan. The Mortgage Relief Program is offering aid to homeowners who have missed at least two mortgage payments or one property tax payment before March 1, 2023. Homeowners who have already received assistance can also apply for more if they have missed more payments and remain eligible, but no household may raise more than $80,000 over the course of the program.

The Mortgage Relief Program was initially viewed as a one-time support, but it is now extending its aid to more homeowners who have defaulted on their payments. California homeowners who have a primary residence of up to four units, such as a maisonette, quadplex, or a house with an adjoining unit, can also receive aid from the program. The main aim of the Mortgage Relief Program is to keep families in their homes, prevent foreclosures, and support homeowners on a stable path to financial recovery.

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