Applications are open for a state assistance program that can help homeowners affected by the COVID-19 pandemic catch up with past due mortgage payments with grants of up to $80,000.
The California Mortgage Relief Program was approved by the U.S. Department of Treasury in late December and will provide $1 billion in mortgage relief to 20,000 to 40,000 homeowners, according to a release from Gov. Gavin Newsom’s office.
“We are committed to supporting those hit hardest by the pandemic, and that includes homeowners who have fallen behind on their housing payments,” Gov. Newsom said in the release. “No one should have to live in fear of losing the roof over their head, so we’re stepping up to support struggling homeowners to get them the resources they need to cover past due mortgage payments.”
The mortgage relief program is part of California’s Housing Is Key assistance program, which has been providing rental assistance to renters and landlords facing financial hardships during the pandemic.
According to the COVID-19 Rent Relief program dashboard, the state has received more than 600,000 applications and more than $1.7 billion in rental assistance has been paid through the program, as of Jan. 19.
The California Mortgage Relief Program will provide one-time grants for eligible homeowners to fully cover past due housing payments up to a maximum of $80,000 per household.
The program is free to apply for, and the grants do not need to be repaid.
The California Mortgage Relief Program is being funded by the federal American Rescue Plan Act’s Homeowner Assistance Fund.
“During this pandemic, Californians have lost their jobs or had their paychecks cut, leading many to wonder how they can keep up with their housing payments,” Lourdes Castro Ramírez, secretary of the business, consumer services and housing agency, said in the governor’s release. “This program will help families keep their homes and provide the stability they need to recover from the financial, physical and emotional toll caused by the pandemic.”
Eligibility requirements for the program are that the household income must be at or below the area median income — which varies by county and household size, but can be calculated on the program’s website; homeowners must be at least two payments behind; applicants must own and occupy a single-family home, condominium or permanently affixed manufactured home in California as their primary residence; homeowners must have faced a pandemic-related financial hardship after Jan. 21, 2020; and either be receiving public assistance, severely housing burdened, or have no alternative mortgage workout option through their mortgage servicer.
According to the program’s website, the area median income for a one-person household in Santa Barbara County is $87,450. For a household of four individuals, the area median income is $124,900.
The area median income for other counties or household sizes can be calculated with the website’s AMI calculator.
Another requirement says that homeowners cannot have cash or assets greater than or equal to the needed relief fund amount plus $20,000, excluding savings in a retirement account.
More details on the eligibility criteria can be found here.
Eligible homeowners can apply for funds from the California Mortgage Relief Program online at the program’s website.
Applicants should be prepared to provide documents such as mortgage statements, bank statements, a utility bill and income documentation, as well as other information that may be required depending on the circumstances.
Once an application is completed, the website states that the process from application submission to a qualified applicant receiving approved funds can take several weeks.
While there is not a deadline to apply, the mortgage relief program’s website states that applying sooner would allow the process to begin more quickly, allowing funds to be allocated sooner if the application is approved.
Funds will be distributed until it is all allocated, with a projected end date by 2025.
Applications and more information can be found on the California Mortgage Relief Program website at camortgagerelief.org.
— Noozhawk staff writer Serena Guentz can be reached at sguentz@noozhawk.com. Follow Noozhawk on Twitter: @noozhawk, @NoozhawkNews and @NoozhawkBiz. Connect with Noozhawk on Facebook.