Dream For All: California Shared Appreciation Loan Program

Are you dreaming of purchasing a home but find yourself facing difficulties like a lack of deposit or closing costs? CalHFA's "Dream for All" Shared Appreciation Loans program is set to return this spring with $225 million allocation. Originally designed to assist lower-income residents in securing their first homes, the program introduced no-interest, no-monthly-payment loans.

Recognizing the overwhelming demand that saw the entire $300 million budget depleted in a mere 11 days during the initial round last year, the program has evolved. This spring, CalHFA will select qualified applicants through a lottery system instead of the previous first-come, first-served approach.

Tightened Eligibility for Targeted Assistance:

In response to the evolving landscape, the program has refined its criteria, now requiring applicants not only to be non-homeowners but also to have parents who are not currently homeowners. This strategic adjustment aims to concentrate assistance on Californians most in need of state support.

Program Highlights:

Funding Allocation: The revised program budget targets supporting between 1,700 and 2,000 loans, with $225 million expected to cover loans up to $150,000 or 20% of the home's purchase price.

Interest-Free Loans: A standout feature is the unique structure of "Dream for All" loans, as they don't accrue interest. Instead, their value rises over time in tandem with home appreciation.

Eligibility Criteria:

First-Time, First-Generation Homeowner: To qualify, the borrower must not have held a stake in a U.S. house in the last seven years, and their parents may not currently own a home.

Special Consideration: The program extends eligibility to those who have been in foster care or institutional care at any time, broadening its reach to those facing unique housing challenges.

Income Limit: Qualified borrowers must meet an annual income limit of 120% of the area median income, varying by county.

Application and Selection Process:

Prequalification: Aspiring homeowners are encouraged to work with participating lenders to obtain a prequalification letter, ensuring qualification for the "Dream for All" program.

Online Portal: The state plans to open an online portal in April for applicants to submit prequalification letters, providing ample time for preparation.

Equal Treatment and Lottery Drawing: All prequalification letters will be treated equally, with CalHFA conducting a lottery to select applicants who will receive vouchers for "Dream for All" loans.

Post-Approval Journey:

While approval for a "Dream for All" loan is significant, it doesn't guarantee immediate home purchase. Applicants must navigate the real estate market, find an affordable home, and secure a mortgage from a conventional lender.

Holding a voucher offers the advantage of a substantial down payment, leading to more manageable monthly mortgage payments and greater financial flexibility.

The "Dream for All" program underscores California's commitment to addressing housing challenges. With a renewed budget, refined eligibility criteria, and a fair distribution system, the program aims to provide meaningful assistance. As the application process unfolds in April, aspiring homeowners, participating lenders, and CalHFA can collaborate in the shared pursuit of turning homeownership dreams into reality.

If you want to benefit from this program, reach out to us, and we'll connect you with a CalHFA-approved lender, ensuring you have the support needed on your homeownership journey.