California governor: 5 big banks suspend mortgage payments
Adam Beam | Hagadone News Network | UPDATED 4 years, 7 months AGO
Unidentified Los Angeles residents are admistered with a test for COVID-19 while in their vehicles inside the Crenshaw Christian Center in South Los Angeles Wednesday, March 25, 2020. With California virus cases surging, Gov. Gavin Newsom said his stay-at-home order for 40 million Californians may stay in place into May. (AP Photo/Damian Dovarganes)
Gov. Gavin Newsom updates the state's response to the coronavirus at the Governor's Office of Emergency Services in Rancho Cordova, Calif., Monday, March 23, 2020. Newsom said he would close parking lots at dozens of beaches and state parks to prevent the spread of coronavirus after large groups flocked to the coast and mountains to get outdoors on the first weekend since the state's stay-at-home order took effect. (AP Photo/Rich Pedroncelli, Pool)
People walks along Zuma Beach, Monday, March 23, 2020, in Malibu, Calif. Officials are trying to dissuade people from using the beaches after California Gov. Gavin Newsom ordered the state's 40 million residents to stay at home indefinitely. His order restricts non-essential movements to control the spread of the coronavirus that threatens to overwhelm the state's medical system. (AP Photo/Mark J. Terrill)
Gov. Gavin Newsom updates the state's response to the coronavirus at the Governor's Office of Emergency Services in Rancho Cordova, Calif., Monday, March 23, 2020. Newsom said he would close parking lots at dozens of beaches and state parks to prevent the spread of coronavirus after large groups flocked to the coast and mountains to get outdoors on the first weekend since the state's stay-at-home order took effect. (AP Photo/Rich Pedroncelli, Pool)
A climber climbs a rock formation along the Pacific Coast Highway, Monday, March 23, 2020, in Malibu, Calif. Officials are trying to dissuade people from using the beaches after California Gov. Gavin Newsom ordered the state's 40 million residents to stay at home indefinitely. His order restricts non-essential movements to control the spread of the coronavirus that threatens to overwhelm the state's medical system. (AP Photo/Mark J. Terrill)
Light traffic and a mostly empty parking lot is seen along Pacific Coast Highway, Monday, March 23, 2020, in Santa Monica, Calif. 2020. Gov. Gavin Newsom said he would close parking lots at dozens of beaches and state parks to prevent the spread of coronavirus after large groups flocked to the coast and mountains to get outdoors on the first weekend since the state's stay-at-home order took effect. (AP Photo/Mark J. Terrill)
Gov. Gavin Newsom updates the state's response to the coronavirus at the Governor's Office of Emergency Services in Rancho Cordova, Calif., Monday, March 23, 2020. Newsom said he would close parking lots at dozens of beaches and state parks to prevent the spread of coronavirus after large groups flocked to the coast and mountains to get outdoors on the first weekend since the state's stay-at-home order took effect. (AP Photo/Rich Pedroncelli, Pool)
Signs are seen advising people to keep their distance from each other as a worker removes an umbrella in front of a restaurant on the Malibu Pier, Monday, March 23, 2020, in Malibu, Calif. Officials are trying to dissuade people from using the beaches after California Gov. Gavin Newsom ordered the state's 40 million residents to stay at home indefinitely. His order restricts non-essential movements to control the spread of the coronavirus that threatens to overwhelm the state's medical system. (AP Photo/Mark J. Terrill)
Signs are seen asking people to keep their distance from each other as two women walk on the Malibu Pier Monday, March 23, 2020, in Malibu, Calif. Officials are trying to dissuade people from using the beaches after California Gov. Gavin Newsom ordered the state's 40 million residents to stay at home indefinitely. His order restricts non-essential movements to control the spread of the coronavirus that threatens to overwhelm the state's medical system. (AP Photo/Mark J. Terrill)
A woman sits alone in front of the ocean along Pacific Coast Highway, Monday, March 23, 2020, in Malibu, Calif. Officials are trying to dissuade people from using the beaches after California Gov. Gavin Newsom ordered the state's residents to stay at home indefinitely. His order restricts non-essential movements to control the spread of the coronavirus that threatens to overwhelm the state's medical system. (AP Photo/Mark J. Terrill)
Light traffic and a mostly empty parking lot is seen along Pacific Coast Highway at the Santa Monica Pier, Monday, March 23, 2020, in Santa Monica, Calif. Officials are trying to dissuade people from using the beaches after California Gov. Gavin Newsom ordered the state's 40 million residents to stay at home indefinitely. His order restricts non-essential movements to control the spread of the coronavirus that threatens to overwhelm the state's medical system. (AP Photo/Mark J. Terrill)
A passer-by pauses to look over the topical books on display at Capital Books, in Sacramento, Calif., Wednesday, March 25, 2020. The shop has been open taking phone orders which they will then mail to or will deliver because of the stay-at-home order due to the coronavirus. Ross Rojek, who co-owns the store with his wife, Heidi, selected a group of timely books, to display in the window, to try to take the edge out of a serious situation. (AP Photo/Rich Pedroncelli)
Police Sgt. Leo Moreno tells a couple they have to keep moving and can't sit on the Esplanade bench Wednesday, March 25, 2020, in Capitola, Calif., explaining that the bench may have the coronavirus on it. (Dan Coyro/The Santa Cruz Sentinel via AP)
SACRAMENTO, Calif. (AP) — Five of the nation's largest banks have agreed to temporarily suspend residential mortgage payments for people affected by the coronavirus, California Gov. Gavin Newsom said Wednesday.
The announcement came as Newsom provided yet another grim statistic about the economic devastation from the virus: 1 million Californians have filed for unemployment benefits since March 13 as businesses shut down or dramatically scaled back because of a statewide “stay-at-home” order to prevent the spread of the virus.
Meanwhile, Newsom said California is rapidly expanding its supply of equipment for health care workers and hospital beds in anticipation of the expected surge in patients that will come as more people are infected. Testing for the virus is accelerating quickly as the state adds locations for the public to get checked.
“We are leaning in to meet this moment," Newsom said.
Wells Fargo, US Bank, Citi and JP Morgan Chase will defer mortgage payments for three months. State chartered banks and credit unions will offer similar deferrals. The banks also pledged not to initiate foreclosure sales or evictions for the next 60 days. And they promised not to report late payments to credit reporting agencies.
Newsom said everyone is eligible, regardless of how much money they make. He said homeowners must submit “some form of documentation,” but did not give details.
“I thought the Great Recession was overwhelming, and we really had to react. This one is much bigger,” said Diana Dykstra, CEO of the California-Nevada Credit Union League. “People’s health is on the line, it’s deeper and broader than that crisis was. It was a housing crisis. This is a crisis for everyone."
Newsom criticized Bank of America for only agreeing to waive mortgage payments for one month. But Bank of American spokesman Bill Halldin said the company isn't capping its offer at 30 days. It will consider delaying payments on a monthly basis that could extend beyond 90 days depending on the length of the crisis.
The news comes after Congress reached an agreement with the Trump administration on a $2 trillion economic stimulus package to keep the economy afloat during the crisis. The plan would increase weekly unemployment benefits by $600 more than what states are already providing.
For California, that means some of the unemployed would be eligible for up to $1,000 per week. That's on top of the $1,200 many adults will get as a one-time payment under the stimulus package.
More help could be on the way for Californians. Assemblyman Phil Ting, a Democrat from San Francisco, said Tuesday state lawmakers could consider a state stimulus package to supplement whatever Congress approves.
Coronovirus cases in California are increasing as more testing is done. A tally by Johns Hopkins University counted nearly 3,000 infections and at least 65 deaths. Confirmed cases in the state are doubling every three to four days, according to California Health and Human Agency Secretary Dr. Mark Ghaly.
California hospitals are preparing for a surge of patients, with state officials projecting the state will need an additional 50,000 hospital beds. Last week, Newsom announced the state had leased Seton Medical Center in Daly City, a hospital that was slated to close after its parent company filed for bankruptcy. On Wednesday, Newsom said the 357-bed facility is operational.
“A significant milestone,” he said.
The governor's office also announced it is emptying the state's special fund for “economic uncertainties" and using the $1.3 billion to buy protective equipment for health care workers and medical supplies and to help hospitals increase their capacity.
When the crisis began, California had a stockpile of 21 million masks for health care workers but was down to 2.5 million on Monday. The state has now acquired 100 million masks and is looking for more, Newsom said. The state also has authorized the procurement of 1 billion gloves.
The state has conducted 66,800 virus tests so far, Newsom said. That's nearly 40,000 more tests than he had previously been announced. The quick increase comes because more labs are now reporting their testing numbers, he said.
Tens of thousands of people tested are still awaiting results, Newsom said.
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Associated Press writer Kathleen Ronayne contributed to this report.
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Follow AP coverage of the virus outbreak at https://apnews.com/VirusOutbreak and https://apnews.com/UnderstandingtheOutbreak.