The California Credit Union League voiced its support for Assembly Bill 238, the Mortgage Forbearance Act, in a letter this week to California Assemblymember John Harabedian. The bill provides financial relief to survivors impacted by the Eaton and Palisades wildfires in the Los Angeles region.
In the letter, the League highlights the severe impact of the wildfires and wind storms — disasters destroying over 18,000 structures and displacing 150,000 residents. Preliminary data suggests that more than one in six borrowers affected by the Eaton fire are at risk of mortgage delinquency, with a staggering increase from 700 to over 4,100 homeowners past due in just one month.
The letter states that credit unions are known for their not-for-profit, member-centric approach and have historically played a vital role in supporting communities during crises. They have consistently offered forbearance, waived fees, and provided emergency assistance during past disasters, including the COVID-19 pandemic and previous wildfires.
The League emphasized that AB 238 aligns seamlessly with the relief efforts credit unions are accustomed to providing their member-owners. “AB 238 takes a thoughtful, practical approach that aligns with the relief that credit unions are accustomed to providing to their member-owners,” the letter states. “The bill grants eligible borrowers an initial 90-day forbearance period, extendable up to 12 months upon request.”
It adds: “Given the long recovery timeline after natural disasters, short-term relief is insufficient. AB 238 ensures a clear, fair, and consistent framework for mortgage forbearance that balances the needs of borrowers and servicers alike, helping stabilize families and communities during their most vulnerable moments.”
The League is urging Harabedian and other lawmakers to support AB 238. The bill provides stability and assistance to wildfire survivors as they navigate recovery efforts.
