Down Payment Assistance for First-Time Home Buyers – San Francisco Bay Times

By Assemblyman Phil Ting–

Home ownership plays a key role in strengthening communities. It also helps families, especially families of color, build and pass on an intergenerational heritage. But one of the challenges of buying a home in California is finding a down payment.

As Assembly Budget Chair, I am proud of our new effort to break the rental cycle and instead boost home ownership. With $100 million in funding, the state just launched the Forgivable Equity Builder Loan program for first-time home buyers. It allows qualified, income-eligible Californians to borrow up to 10% of the purchase price of the home without interest. It’s true. Zero interest. Additionally, if the resident lives in that home for at least five years, the loan is forgiven, which helps the homeowner build equity much faster.

I’m excited about this latest route to homeownership, as the assistance targets working families who make enough money to pay a monthly mortgage, but don’t have the savings for a down payment. According to a recent California Forward report, of our state’s 555,858 home sales in 2021, more than 35% were purchased by first-time buyers.

I see an opportunity to increase these numbers under our new forgivable loan program. Owning a home provides stability, economic security and a sense of belonging. Additionally, landlords tend to be more involved in issues affecting their neighborhood and city.

To be eligible, applicants must earn less than 80% of their county’s median income. In San Francisco, that limit is $106,880. For all counties in the Bay Area, the cap is less than $120,000. The property can be a townhouse, single family home, condos or manufactured homes in California and must be a primary residence.

In addition to this, people must complete homebuyer education guidance and obtain a certificate of completion through an authorized body. Then they must be approved for a mortgage. It is best to work with loan officers who are familiar with the repayable loan program. Documents to prepare:

  • payslips
  • Bank statements
  • Employment history
  • Tax returns

Further information, including a list of approved lenders, is available on the California Housing Finance Agency website:

I know how hard it is to break into the home buying market with rising house prices and mortgage rates. My colleagues in the Assembly and I know that we must do more to increase homeownership rates. We have made progress in housing production and affordability over the years. But there are still gaps and obstacles that current plans and programs do not address.

More Californians deserve a chance to make their dream of home ownership a reality. We are committed to creating more opportunities to take that first step.

Phil Ting represents the 19th Assembly District, which includes the Westside of San Francisco as well as the communities of Broadmoor, Colma and Daly City.

Posted May 19, 2022

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