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What does California Proposition 37 do?
California’s Housing Finance Agency would be able (but not required) to borrow up to $25 billion to help would-be homebuyers purchase newly constructed houses and condos. These loans could provide up to 17% of a home’s purchase price, leaving buyers with a cash down payment of 3% if paired with a typical mortgage — $24,000 for an $800,000 home. Homebuyers would repay the loan in monthly installments to private lenders. Anyone earning up to twice the area’s median income would be eligible. Private lenders, not taxpayers, would be on the hook if homebuyers default. It was placed on the ballot by a coalition of real estate interests and labor unions.
What do supporters and opponents say?
Ballot text
CREATES LOAN PROGRAM FOR MIDDLE-INCOME BUYERS OF QUALIFIED NEW HOMES. INITIATIVE STATUTE. Authorizes $25 billion in bonds to offer eligible buyers fixed-rate mortgages for up to 17% of purchase price of a newly constructed home priced below about $1.5 million. Borrowers must be California residents, occupy the home, meet income limits, and pay at least 3% down. Bonds repaid by mortgage payments, not State. Fiscal Impact: No direct state or local costs.
Source: California Secretary of State
