By Nijzel Dotson, KCRA
Another round of funding for a down payment program to help homebuyers in California will be available this spring, and there are changes to the application process.
The Dream for All program lends borrowers up to 20% of a home's price, and then when the buyer sells or refinances, they repay 20% of the appreciated value to the state of California. That money is used to fund the next round of down payment assistance.
The round of funding this spring will be different from last year's.
In 2o22, $300 million was set aside for homebuyers on a first-come, first-served basis and the money was allocated to approximately 2,000 applicants in just 11 days.
This year, the amount of funding being dished out is $250 million and a lottery process will be used to determine which applicants receive loans.
Eric Johnson with the California Finance Agency said this round hopes to help between 1,600 and 2,000 more people.
“You’ve got some time before that lottery opens in April to work with one of our approved lenders, get your paperwork together, make sure your credit score, your debts are all squared away and then you can put in an application for this lottery,” Johnson said.
Starting in the first week of April, the lottery will be open for about a month, “so there’s no hurry,” he said. “You don’t have to get it in on the first day.”
Among the requirements is that at least one person on the application must now either be a first-generation homebuyer or have been in the foster system to qualify.
Being a first-generation homeowner means the applicant hasn't owned a home in the past seven years and their parents don’t currently own a home, Johnson said.
People also need to have a credit score of at least 680 and “some good debt-to-income ratios,” Johnson said.
For more information on the program, click here.