California’s Mortgage Relief Program Faces Exhaustion of Funds

California continues to offer mortgage relief through the 2021 American Rescue Plan, including support for reverse mortgage borrowers. However, state housing officials caution that the program’s funding is dwindling and could soon be depleted. Despite an extension to include more eligible recipients in February, officials urge those in need to act swiftly to access the financial assistance, primarily aimed at homeowners financially impacted by the COVID-19 pandemic.

The program, which initially allocated $1 billion to California, has disbursed over $823 million, leaving approximately $177 million, which is expected to be exhausted in the coming months. With an average assistance of over $24,000 per household, the program has aided more than 33,000 households statewide since its launch in late 2021.

While the federally created Homeowner Assistance Fund (HAF) is available to all borrowers, including reverse mortgage holders, challenges remain in ensuring widespread utilization. Efforts to expand eligibility in California aim to expedite aid distribution, addressing an awareness gap that has hindered assistance deployment nationwide, particularly affecting potential reverse mortgage beneficiaries.