June 25, 2024

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California is relaunching its Dream for All down payment program for first-time homebuyers

California is relaunching its Dream for All down payment program for first-time homebuyers

Los Angeles (KABC) — California will offer $250 million in down payment assistance this spring, relaunching its widely popular program aimed at helping first-time homebuyers.

last year, The dream program for everyone It started with $300 million and sold out in just 11 days.

this year, California Housing Finance Agency Making changes aimed at reaching a more diverse group of borrowers across the state. This time, instead of launching the program on a first-come, first-served basis, there will be a lottery.

How does the Down Payment Assistance Lottery work?

“The next round of the California Dream for All Shared Appreciation Loan Program will focus on first-generation homebuyers and use the lottery system to ensure equitable distribution of loans,” a statement from the department said. “Interested homebuyers can begin working with an approved loan officer or approved lender now in preparation for applying in April for the lottery.”

As many know, buying a home for the first time can be a challenge, and for many, the hardest part is getting the down payment.

Read also | California's new program for first-time homebuyers will let you borrow a down payment at 0% interest.

“Resources are limited, they may be carrying debt from school or other sources, so this is a very big challenge,” real estate agent Sarah Moore said, adding that more people were now aware of the Dream for All programme.

“It's helpful because when it first launched, there wasn't a good way to educate the buyers out there,” she said.

All of this comes as home sales slow.

December sales were 6.2% lower than last year, but prices are still high. Data from Zillow shows typical home values ​​in Southern California are above their peak in 2022.

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In Los Angeles and Orange counties, a typical home is worth just over $900,000. In Ventura County, it's just over $831,000 and in the Inland Empire, it's just under $560,000.

How much will I get?

The state will waive up to 20% of the purchase price, or $150,000, whichever is less. The loan will then be repaid, plus a share of the home's appreciation when it is sold in the future.

“When they pay that back, it's going back into the program, and it's going to allow someone else to benefit from it,” Moore said. “So I feel like it's, you know, a very mutual thing, where everyone wins.”

Officials estimate that between 1,700 and 2,000 lottery winners will receive coupons and will then have 60 days to spend them on a house.

For more information on how to apply, click here.

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