When Los Angeles was caught in the destruction of the Palisades and Eaton fires, Gov. Gavin Newsom plans to sponsor a bill to ensure homeowners rather than lenders rather than loans, according to his office The interest obtained by a person from insurance expenses for destroyed or damaged property.
“A homeowner rebuilding after the disaster requires all support, including interest earned by their insurance funds,” Newsom said in a statement announcing the planned bill.
The state bill will be written by the General Assembly to raise John Harabedian (D-Pasadena). A spokesman for the Newsom office said the bill is expected to be introduced by the end of this month.
Bill supporters say insurance spending can generate huge interest, and the money sits in custody during the reconstruction. California law has required loans to pay homeowners property taxes and interest on insurance funds for custody funds, rather than insurance expenses held in custody, according to the governor’s office.
A spokesman for the Newsom office said interest rates are typically about 2% per year, about $20,000 per year, to spend $1 million on destroyed homes.
