SACRAMENTO — Four of the nation’s largest banks agreed to temporarily suspend residential mortgage payments for Californians affected by the coronavirus, Gov. Gavin Newsom said Wednesday.
The announcement comes as more than 1 million Californians have filed for unemployment benefits since March 13 because many businesses have had to shut down because of a statewide “stay at home” order to prevent the spread of the virus.
Most Banks Offer 90-Day Deferral
Wells Fargo, US Bank, Citi and JP Morgan Chase have all agreed to suspend mortgage payments by 90 days for people affected by the coronavirus. An additional 200 state charter banks and credit unions made similar commitments, he said.
But Newsom noted Bank of America agreed to pause payments for one month. “I hope they will reconsider and join those other banks that are wiling to do the right thing,” he said.
Newsom said everyone is eligible, regardless of how much money they make. He said homeowners must submit “some form of documentation,” but he did not give details.
Under traditional loan forbearance programs, monthly payments are temporarily suspended but the homeowner still must make up the deferred amounts at a later time.
The news comes after Congress reached an agreement with the Trump administration on a $2 trillion economic stimulus package to keep the economy afloat during the crisis. The plan would increase weekly unemployment benefits by $600 more than what states are already providing.
Governor Urges Against Rush to Phones
Anticipating a surge of requests, Newsom urged homeowners to take their time to get their mortgage documents in order before contacting their lender.
“If every single person with a residential mortgage makes a phone call at the same time to their bank, those call centers will collapse,” Newsom said.