Seeking to chip away at an ambitious goal of boosting home ownership in California, the state has launched a new program of forgivable loans for first-time home buyers.
The program, Forgivable Equity Builder Loan, allows qualified, first-time buyers to borrow up to 10% of a home’s purchase price, and have the debt forgiven if the buyer lives in the home for five years. The loans are available to middle-income families making less than 80% of their county’s annual median income, below $120,000 in all Bay Area counties.
California lawmakers earmarked $100 million in the state budget for the first-time homeowner loans. The goal is to help working families with enough income to pay a mortgage but not enough savings to ante up for a down payment.
