California Program Allows First-Time Homebuyers To Borrow Down Payment At Zero Percent Interest

CBS Los Angeles

May 3, 2022

One of the biggest hurdles in buying a home is coming up with a hefty down payment, and California has a new program to help first-time homebuyers jump that hurdle.

California's Forgivable Equity Builder loan allows first-time homebuyers who have enough income for a monthly mortgage payment to borrow up to 10% of a home's purchase price to buy a house outright. The loan has an interest rate of zero percent, but borrowers who don't occupy the home for at least five years may have to repay the loan.

The new effort comes as real estate prices have hit record highs in California, and rising interest rates have pushed monthly payments up hundreds of dollars. A standard down payment of 20% for a home in California can cost upwards of $100,000.

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