Loan Information

First Time Homebuyer or Home Repair Loan Information

 

If you have a loan through the Town of Paradise and your home was lost in the Camp Fire, the Town is forgiving the interest (ONLY) on your loan; the principal amount cannot be forgiven.  Please know that you have options of what to do with your insurance proceeds:

1.  If you intend on rebuilding on the same site in Paradise, ALL insurance proceeds can be made available to you in an escrow account held by either the Town (if we hold the first mortgage) or a first lender (if you pay a monthly mortgage).  This option will give you the most money for rebuilding. You should receive a check from your insurance company with our name on it; please bring it to our temporary Town Hall (441 Main Street, Chico). We will either deposit it into an escrow account or endorse it and send it on to your first mortgage.  If you had a monthly mortgage payment prior to the fire, you will be expected to continue to make your payments.

 

2.  If you would like to cash out your insurance proceeds, you will have to pay all of your mortgage debts off first.  If you intend on rebuilding on the same site in Paradise, the Town can hold the Town's pay-off funds in an escrow account, but we will only release the funds to you when you are close to obtaining your Certificate of Occupancy on your new home.  Your loan with us stays in place and continues with the original terms. You should receive a check from your insurance company with our name on it; please bring it to our temporary Town Hall (441 Main Street, Chico). We will either deposit the check and return to you the remainder of the funds (which can take up to two weeks) or forward the endorsed check to your first lender with instructions on paying us back.  Please know that some lenders might not send the funds directly to us; if they do not, you are responsible for paying off your debt with the Town so be sure to understand what your first mortgage has done before committing all of the funds returned to you. Once we receive our pay-off funds, we will deposit them into an escrow account for you.

 

3.  If you will not be rebuilding on the same site in Paradise, you will have to pay off all of your mortgage debts, and then you can do as you please with the remaining funds.  You should receive a check from your insurance company with our name on it; please bring it to our temporary Town Hall (441 Main Street, Chico). We will either deposit into those funds and return the remainder to you (which can take up to two weeks) or forward the endorsed check to your first lender with instructions on paying us back.  Please know that some lenders might not send the funds directly to us; however, if they do not, you are responsible for paying off your debt with the Town so be sure to understand what your first mortgage has done before committing all the funds returned to you.

 

If you have any questions, please feel free to contact Kate Anderson at This email address is being protected from spambots. You need JavaScript enabled to view it. or call her at (530) 872-6291.