Sep 5, 2023

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Market

What's California's Shared Appreciation Mortgage

California is infamous for its high cost of living, especially in terms of housing. To combat this, the state has introduced the Shared Appreciation Mortgage Program, an innovative initiative aimed at making homeownership more attainable for low- and middle-income residents. Sharing the same mission, Restate Homes is offering an alternative solution that is proving to be equally attractive, if not more so.

Shared Appreciation Mortgage: A California Initiative

The Shared Appreciation Mortgage (SAM) is a unique type of mortgage loan designed to help prospective homebuyers afford homes that might otherwise be beyond their reach. The homebuyer agrees to repay the mortgage along with a share of the home’s price appreciation. This repayment strategy ensures that the program can maintain housing affordability for future purchasers as prices rise over time. California’s down payment assistance loan, structured as a SAM, requires no payments over the loan term.

The program offers assistance of up to $375,000 to support home purchases for low- and middle-income first-time homebuyers seeking to buy a market-rate principal residence.

To be eligible for this program, applicants must meet several requirements, including

  • being a first-time homebuyer,

  • occupying the property as a primary residence,

  • completing two levels of homebuyer education counseling, and

  • meeting CalHFA income limits for this program.

Restate Homes: An Attractive Alternative

Restate Homes is revolutionizing the traditional mortgage landscape by offering a unique solution that can help both new and existing homeowners lower their monthly payments by up to $1,000 each month. Here are some additional advantages of Restate Homes’ program:

  • Flexibility: The program is designed to adapt to various financial situations, making it a viable option for a wide range of homeowners.

  • Accessibility: Unlike the San Francisco program which has income restrictions and is only available to first-time homebuyers, Restate Homes’ program is widely accessible to new homebuyers and existing homeowners.

  • Financial Stability: Lower monthly payments can lead to increased financial stability as homeowners may find it easier to budget for their other expenses.

  • Home Equity: Participants in the program still have the opportunity to build substantial home equity over time as the homeowner will remain as the majority equity holder.

  • Support: Restate Homes provides ongoing support to participants, helping them navigate the often complex world of home financing.

By offering these benefits, Restate Homes is not just helping individuals and families own their homes; it’s also contributing to the broader goal of promoting sustainable homeownership and financial stability. It’s indeed an attractive alternative to traditional mortgage programs!

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