California Housing Finance Agency’s $300 Million Down Payment Assistance Program Fully Allocated in Less Than Two Weeks
The California Housing Finance Agency’s $300 million down payment assistance program, known as the Dream for All Shared Appreciation Loan, has been met with overwhelming demand since its launch less than two weeks ago. The program, aimed at helping first-time homebuyers secure a down payment on a house, is set to pause as all funds are expected to be fully allocated to participating homebuyers by Monday.
Introduced on March 27, the Dream for All program offers interest-free loans to qualified applicants to cover up to a 20% down payment on a home, as well as closing costs. However, the program’s funding has been quickly exhausted, with the California Housing Finance Agency stating that interested applicants must secure their loans by April 12 at 3 p.m.
A Reddit thread on the r/orangecounty subreddit highlighted the rapid depletion of the program’s funds, with some expressing surprise at how quickly the funds were claimed. Questions were raised about how applicants were able to navigate the homebuying process, including pre-approval, counseling, finding a home, and entering escrow in such a short timeframe.
While the Dream for All program aims to assist low- and moderate-income Californians in achieving homeownership, there is a catch. The down payment assistance loan, which must be repaid to the state, is a shared appreciation loan. This means that borrowers must also repay a percentage of their home’s appreciation in value when they repay the loan.
Despite the repayment requirements, the California Housing Finance Agency believes that the program will largely fund itself through the proceeds generated from home appreciation percentages. This initiative aims to help future California homebuyers overcome the barrier of saving up a 20% down payment in a state known for its high housing costs.
As the program reaches its funding limit, many hopeful homebuyers are left wondering how they missed out on this opportunity and what the future holds for affordable homeownership in California.