(KRON) – The state of California announced two initiatives for homebuyers last month, one of which offers forgivable loans for up to 10% of the purchase price for some first-time buyers.
The Forgivable Equity Builder Loan was introduced by the California Housing Finance Agency in April. It will allow some first-time homebuyers to get forgivable loans for up to 10% of the purchase price of the home.
“If the homebuyer stays in the home for five years, they do not have to repay the junior loan, making homeownership more attainable for Californians,” a press release from the agency states.
The loan is available only to Californians whose income is less than 80% of the median income in the county where the property is located. The press release gives, as an example, Santa Clara County, where $118,960 is the limit for qualifying.
Tiena Johnson Hall, the agency’s executive director, stated in the press release that the initiative is all about about creating more equitable access to home ownership.
“Home equity has proven to be one of the strongest ways for families to build and pass on intergenerational wealth and CalHFA is committed to improving equitable access to homeownership for all Californians,” stated Hall. “The Forgivable Equity Builder Loan, which gives first-time homebuyers a head start with immediate equity in their homes, will help California families build and pass on that wealth with a secure, stable home loan.”
Loan officers can be found on the agency’s website, where they are listed by county.
In a second initiative, the state’s Department of Housing and Community Development will be providing over $67 million in grant funding for 33 CalHome program projects.
The CalHome program provides grants to local public agencies and nonprofits for housing assistance, counseling and first-time homebuyers.
“Funds assist individual first-time homebuyers through deferred-payment loans for down payment assistance, home rehabilitation, including manufactured homes not on permanent foundations, acquisition and rehabilitation, homebuyer counseling, self-help mortgage assistance, or technical assistance for self-help homeownership,” the same press release states.