Los Angeles fire survivors face a $500,000 rebuild gap, even after insurance

Many Los Angeles-area homeowners still do not have enough insurance money to rebuild after the January 2025 Eaton and Palisades fires.

A typical household, a new survey found, remains about $500,000 short.

Here's what to know

According to LAist, that estimate comes from a July Department of Angels survey of more than 2,000 survivors in the Eaton and Palisades fire zones. It measures how much money families still need to rebuild after insurance payouts.

LAist reported that the fires have caused at least 31 confirmed deaths, with hundreds more later linked to them, and they wiped out more than 16,000 homes, businesses, schools, and other buildings.

In the Eaton burn area, 150 homes had been rebuilt; in the Palisades, there were 36. The outlet also said about two-thirds of survivors are still displaced, roughly half have used up major savings, and nearly half have taken on debt.

"There are still people out there who need help," said Ursula Hyman, co-founder of the Altadena Land Initiatives Corporation.

More background

Another strain, LAist reported, involves temporary housing: about half of survivors have either already exhausted that insurance coverage or expect it to run out within a year.

That gap is forcing hard decisions. Some households are borrowing more, while others are weighing whether returning to their neighborhood is financially possible. When rebuilding costs greatly outpace insurance coverage, recovery can drag on for years.

For Hyman, the issue is personal. LAist reported that the Eaton fire badly damaged her home and destroyed her daughter's. Her nonprofit is among several working to close the gap left when more traditional financial support has not been enough.

"It's much harder for all of the nonprofits to raise money right now," Hyman said. "We'd like to do 100 homes this year, and I have about enough capital right now to do 25."

What's being done?

One tool some survivors have used is a Small Business Administration loan, LAist reported, although the application period officially ended in June. Other aid is still on the table, including the state's CalAssist Mortgage Fund, which can offer up to a year of support, as well as a federal extension of housing assistance and mortgage relief from some banks.

New programs focused specifically on rebuilding are also starting to emerge. One fund backed by Cathay Bank offers zero-interest loans averaging about $260,000 and also connects borrowers with preapproved plans and screened builders, with no income requirements.

Another fund reportedly offers temporary housing help and grants of up to $250,000 to Eaton Fire rebuilders, with no income caps and nothing to repay. Other organizations, LAist noted, are assisting survivors from both fires with smoke cleanup, home repairs, and rebuilding support.

Lendistry, a Los Angeles-based firm, has launched a pilot program that, according to LAist, is backed by Bank of America and the California Community Foundation. It is meant to pair financial guidance with construction loans and mortgage assistance.

Separately, survivors have also been pressing Sacramento for faster relief, and LAist reported that Gov. Gavin Newsom approved $100 million in state funding for rebuilding, though lenders are still in the process of rolling that program out.

As Hyman put it, "It's not old news to the people who are still living it."

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