California strives to help residents interested in becoming homeowners.
The state launched a program last month allowing first-time home buyers to borrow a down payment at 0% interest.
The home equity loan program will help buyers obtain a loan of up to 10% of the purchase price of a home. It is offered by the California Housing Finance Agency.
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The loan does not need to be repaid if the buyer stays in the house for 5 years.
“Being a first-time home buyer is obviously a bit more difficult for them because they don’t necessarily have the house to build equity in the last couple of years. So this program is great,” said Oscar Wei, economist in Deputy Chief at the California Association of Realtors.
Wei said the state program will increase home ownership affordability.
“In California last year, about a third of homes were sold to first-time buyers, so we have a lot of people who want to buy, buy homes,” Wei said.
The program is only available to Californians whose income is less than 80% of the area median income in the county of the property.
It can be used for down payments and closing costs.
“We’ve found that a lot of people have enough money to make a monthly payment on a mortgage, but they don’t necessarily have that money saved up to make the down payment,” said Eric Johnson of the California Housing Finance Agency. .
Palm Springs-based real estate agent J. Ovier Alvarez said with soaring real estate prices in the Valley, first-time home buyers have to compete with cash offers and investors. This program, he said, will level the playing field.
“Yes, it’s difficult, but not impossible,” Alvarez said. “We can make it happen.”
State officials said the program is aimed at getting immediate equity from first-time home buyers — to build and eventually be able to pass on intergenerational wealth.
$88 million has been set aside, but officials said demand was high.