CalHFA board authorizes $100 million package to jump‑start rebuilding for disaster‑affected homeowners

The California Housing Finance Agency board approved a plan to use $100 million—$56 million from the state budget and $44 million reallocated from National Mortgage Settlement funds—to capitalize a Disaster Rebuilding Assistance program designed to expand construction financing for homeowners who lost or had homes damaged in qualifying disasters.

Ellen Martin, CalHFA’s director of homeownership, described two complementary program mechanisms: a construction loan loss guarantee to reimburse lenders for a portion of eligible net losses (staff said a capitalization amount could allow up to a roughly 10:1 issuance multiple of guarantees) and a construction loan rate buy‑down program that reimburses lenders for lender‑funded buy‑downs and other prepaid interest that reduce borrower costs. Martin said the agency expects to publish detailed program term sheets at an early‑August announcement and aims to open loan enrollments in early September, contingent on lender onboarding.

Eligibility will mirror CalAssist disaster definitions (events with state of emergency, proclamation, or major disaster declarations from Jan. 1, 2023 through Jan. 8, 2025). Program income limits differ by mechanism: staff said the loan loss guarantee will use limits up to 200% of AMI; the rate buy‑down will be limited to borrowers at or below 150% AMI with additional benefits for those at or below 100% AMI. The loan loss guarantee would reimburse up to 75% of an eligible net loss, capped at $250,000 per loan; buy‑down reimbursements would be tiered with lower‑income borrowers eligible for up to $100,000 subject to maximums tied to a percentage of loan amounts, and other borrowers eligible for up to $50,000.

Directors asked about agency exposure, leverage and program administration. Martin said the staff analyzed construction lending risks and designed guardrails, and that CalHFA will collect actuarial information to inform private liquidity partners. She said CalHFA generally charges about a 5% administration fee on programs and expects that to cover staffing and outside contracts. The program also includes consumer protections in the lender participation agreement: limits on lender compensation and pricing, contractor qualification requirements and managed construction escrows.

Public commenter Ruby Torralva urged stronger transparency and public reporting measures for the use of the funds; Martin said program guidelines and term sheets would be published with the announcement and staff will monitor uptake and retool targeting if necessary. The board moved, seconded and approved Resolution 26‑21 authorizing the fund distributions and program implementation steps.