California's New Helping Hand for Homebuyers

In California's Bay Area, a place known for its sky-high housing prices, a new opportunity is making waves for those dreaming of owning a home but struggling with the upfront costs.

A program is now available, offering up to $200,000 in loans to assist first-time homebuyers with their down payments, focusing on aiding those with lower incomes to climb onto the property ladder.
 

The High Cost of California Living

California stands as one of the priciest states to buy a home in the United States. The Bay Area, in particular, showcases extremely high prices with the average home in California costing $832,500 as of February - a 6% increase from the previous year and nearly 70% higher than prices in February 2020.

The cost is even steeper in cities like San Francisco and San Jose, where the median home price reaches around $1.4 million.

Due to rising home prices and mortgage rates lingering between 6% and 7%, many Californians, especially low-income earners, find themselves unable to buy a home.

Read more: The Age of First-Time Homebuyers is Reaching New Heights
 

Details of the Home Access Program

Aiming to tackle this issue, the Home Access Program by Housing Trust Silicon Valley, a nonprofit based in San Jose, is stepping up. This program offers first-time buyers in the greater Bay Area a chance to receive a loan covering up to 40% of their home's purchase price, maxing out at $200,000.

There are some requirements: the program is only for buyers of primary residences in Alameda or Contra Costa County. Applicants need to have a household income below 80% of the area's median income, with limits varying based on the number of people in the household.

Buyers must also secure pre-approval from a program-affiliated lender, save a minimum 3% down payment, and complete an eight-hour homeowner education class approved by the Department of Housing and Urban Development.

Eligible homes include single-family homes, townhomes, or condos located in either Alameda or Contra Costa Counties.
 

Loan Details

The down payment help comes in the form of a 30-year deferred loan with a simple interest rate, accruing annually. This loan doesn't require monthly repayments, but it must be paid back fully at the end of the term or if the property is sold before the 30 years are up.

Participants are expected to contribute at least 3% of the home's purchase price from their own funds. For context, in Alameda County, the median home price was $1,117,500 in February, showing a slight increase from the previous year.
 

Next Steps

Interested first-time homebuyers who believe they meet the criteria should submit an interest form. Housing Trust Silicon Valley promises to follow up within three business days, paving the way forward for hopeful homeowners.

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Find out if you're eligible for housing support here!