The California Mortgage Bankers Association (California MBA) testified on Friday, March 20, 2026, before the Assembly Banking & Finance Committee during its oversight hearing on AB 238, addressing the effectiveness of mortgage forbearance and the broader challenges facing homeowners impacted by recent wildfires.
During the hearing, lawmakers heard directly from families navigating displacement, insurance delays, and the complex, multi-year process of rebuilding. California MBA reinforced the critical role mortgage lenders and servicers play in providing immediate relief and ongoing borrower support following natural disasters.
“Natural disasters don’t create one problem — they create a chain reaction across housing, insurance, and financial stability,” said Paul Gigliotti, CEO of the California Mortgage Bankers Association. “We showed up on Friday to support both our industry and the homeowners we serve, and to reinforce that recovery requires more than short-term relief — it requires real coordination and execution.”
Testimony highlighted that while mortgage forbearance provides essential short-term support, it is not a long-term solution. California MBA emphasized that extending forbearance without a clear path forward may unintentionally increase financial strain on borrowers over time.
The Association also underscored that recovery challenges extend beyond mortgage relief alone. Borrowers are navigating a range of interconnected issues, including:
- Insurance claim delays and coverage gaps
- Permitting and rebuilding timelines
- Temporary housing availability and rent pressures
- Communication gaps across stakeholders
California MBA called for a more comprehensive and collaborative approach to disaster recovery policy — one that brings together state leadership, the insurance sector, housing stakeholders, and the mortgage industry.
“Forbearance is a bridge — but we have to be just as focused on what comes next,” Gigliotti added. “We are ready to work alongside Assemblymembers and stakeholders to build scalable solutions that address the full recovery process — not just lending, but insurance, permitting, and housing stability. If we get this right, California has the opportunity to lead the nation in how we respond to natural disasters.”
California MBA encouraged policymakers to engage directly with the Association and its members as efforts continue to develop long-term, sustainable recovery frameworks that can be applied to future disasters across the state.
About the California Mortgage Bankers Association
The California Mortgage Bankers Association (California MBA) is a leading advocate for the real estate finance industry, representing mortgage lenders, servicers, and industry partners operating in California and across the country. The association works to advance responsible lending, promote innovation, and ensure policymakers understand how legislation and regulation impact the mortgage industry and the consumers it serves.
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