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Governor Updates On State’s COVID-19 Response

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Sacramento, CA – Governor Gavin Newsom took up several issued related to COVID-19 during an afternoon live address including mortgage relief, unemployment, testing, and social distancing.

Newsom announced Californians economically impacted by COVID-19 may receive 90-day grace periods to make mortgage payments. He relayed that four of the nation’s largest banks have agreed to temporarily suspend mortgage payments for those affected by the coronavirus.

Calling it a “model for the rest of the nation,” Newsom praised Wells Fargo, US Bank, Citi, and JP Morgan Chase while chastising another, “Four of the five largest [banks] committed to that 90 days. Unfortunately, Bank of America did not publicly did not commit to that. They just committed to 30 days. I hope they will reconsider and join those other banks that are willing to do the right thing by at least extending that commitment.” At the bottom of the page is the outline of the grace period that the governor says also will not negatively impact credit reports.

Newsom cheered the proposed Senate relief bill to fight the coronavirus pandemic. California provides up to $450 per week in unemployment insurance, Newsom noted, “The package will provide for an additional $600 on top of that so for over a thousand dollars a week for many Californians. By the way, the reason I say it is timely, we just past the one-million mark in terms of the number of claims just since March 13th.” That was reached in under two weeks.

Regarding medical supplies, the governor disclosed that already 24.2 million N95 masks have been distributed in the state with another 100 million having been secured.  He also remarked there have been nearly 70,000 tests done, but noted, “Tens of thousands of those tests are waiting for the results to be finalized. The backlog now is not just on reagents and on extraction kits and on the swaps themselves, but now also on the delay in getting the results of these tests.”

During the address, the governor also suggested that instead of calling it “social” distancing, it be changed to “physical” distancing, which he explained is less confusing to younger people. Noting that the stay at home order is not going away anytime soon, he expressed, “For the younger folks out there, physically separate from others and strangers. Don’t mix and don’t think for a second that we’re a day or two away from lifting that order, we’re not. We’re not even a week or two away.”

As the deadly virus is surging, the governor suggested the order could stay in place into May.

 

Outline of governor’s mortgage relief:

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.

 

 

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