Housing Watch: Shared appreciation loan covers 20% down payment

FRESNO COUNTY, Calif. (KFSN) -- The state launched a new program this week to help assist first-time home buyers.

California's Shared Appreciation Loan represents a new strategy for people who just can't afford to buy a home.

The state provides your 20% down payment.

Frustrated home buyers who still find themselves priced out of the market may be able to take advantage of the state's new Shared Appreciation Loan.

It would cover a 20% down payment - that's $100,000 on a $500,000 home.

"With something like this, hopefully it will stimulate the market and also another section of groups that were maybe shut out or maybe they had to wait. Either pay down debt or save more money to qualify," said Paul Salazar, a loan officer.

To qualify in our six-county viewing area, families can't make over $159,000 a year. You must also have good credit.

Eric Johnson of the California Housing Finance Agency says the program is designed to help more renters buy a home.

"When you sell the home in the future, you have to pay back that 20% loan, plus 20% of any appreciation in the value of your home," said Johnson.

For example, if that $500,000 home increases in value by $100,000 when you sell, you'll have to pay 20% of that - $20,000 - in addition to the $100,000 down payment.

Paul Salazar says his office at Sierra Pacific Mortgage in northwest Fresno is an approved state lender for the new program for first-time home buyers.

"I'll tell you who the most people about it are the realtors. Now they have a new crop of buyers to go out and look at houses that can be pre-qualified with this program," said Salazar.

Johnson says the state has already locked in 200 loans since the program was first announced on Monday.

"We really think it's important to help folks who haven't been able to tap into the homeownership market historically, so this program is really about equity and helping homeowners pass on that generational wealth," said Johnson.

At this point, the state has not set a limit on how much money will be allocated for the Shared Appreciation Loan program.

If you are interested in this loan program, Paul Salazar is hosting an informational session at 1 pm on Wednesday at Sierra Pacific Mortgage.

For more information, click here or here.

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