California law doubles wildfire mortgage forbearance to two years
The extension adds a new condition. Borrowers must now affirm not only financial hardship but that the property securing the loan is uninhabitable because of the wildfire disaster.
For servicers, the operational changes run deeper than the timeline.
When a borrower seeks forbearance beyond 12 months, servicers may request additional documentation – but only if the investor, guarantor, insurer, or holder of the loan has first made a written request for it and the documents relate to the borrower’s hardship, the property’s habitability, or restoration efforts.
The notification window shifted. Servicers previously had 10 business days to approve or deny a request. That is now 21 days, extendable by agreement when additional documentation is involved. If a servicer denies a request under delegated investor authority, written notice is required – including the text of the guideline behind the denial.
Curable defects get their own process: servicers must identify the issue, give borrowers 21 calendar days to fix it, and respond within five business days.
