51504
. (a) The agency shall administer a downpayment assistance
program that includes, but is not limited to, all of the following:
(1) Downpayment assistance shall include, but not be limited to, a
deferred-payment, low-interest, junior mortgage loan to reduce the
principal and interest payments and make financing affordable to
first-time low- and moderate-income home buyers.
(2) (A) Except as provided in subparagraph (B) or (C), the amount
of downpayment assistance shall not exceed 3 percent of the home sale
price.
(B) The amount of downpayment assistance for a new home within an
infill opportunity zone, as defined in Section 65088.1 of the
Government Code, a transit village development district, as defined
in Section 65460.4 of the Government Code, or a transit-oriented
development specific plan area, as defined in paragraph (6), shall
not exceed 5 percent of the purchase price or the appraised value,
whichever amount is less, of the new home. The borrower of the
downpayment assistance shall provide the lender originating the loan
with a certification from the local government agency administering
the infill opportunity zone, the transit village development
district, or the transit-oriented development specific plan area that
states that the property involved in the loan transaction is within
the boundaries of either the infill opportunity zone, the transit
village development district, or the transit-oriented development
specific plan area.
(C) Notwithstanding paragraph (1), the agency may, but is not
required to, provide downpayment assistance that does not exceed 6
percent of the home sale price to first-time low-income home buyers
who, as documented to the agency by a nonprofit organization that is
certified and funded to provide home ownership counseling by a
federally funded national nonprofit corporation, are purchasing a
residence in a community revitalization area targeted by the
nonprofit organization as a neighborhood in need of economic
stimulation, renovation, and rehabilitation through efforts that
include increased home ownership opportunities for low-income
families. The agency shall not use more than six million dollars
($6,000,000) in funds made available pursuant to Section 53533 for
the purposes of this paragraph.
(3) The amount of the downpayment assistance shall be secured by a
deed of trust in a junior position to the primary financing
provided. The term of the loan for the downpayment assistance shall
not exceed the term of the primary loan.
(4) (A) Except as provided in subparagraphs (B) and (C), the
amount of the downpayment assistance shall be due and payable at the
end of the term or upon sale of or refinancing of the home. The
borrower may refinance the mortgages on the home provided that the
principal and accrued interest on the junior mortgage loan securing
the downpayment assistance are repaid in full. All repayments shall
be made to the agency to be reallocated for the purposes of this
chapter.
(B) The agency may, in its discretion, permit the downpayment
assistance loan to be subordinated to refinancing if it determines
that the borrower has demonstrated hardship, subordination is
required to avoid foreclosure, and the new loan meets the agency's
underwriting requirements. The agency may permit subordination on
those terms and conditions as it determines are reasonable.
(C) The amount of the downpayment assistance shall not be due and
payable upon sale of the home if the first mortgage loan is insured
by the Federal Housing Administration (FHA) or if the first mortgage
loan is, or has been, transferred to the FHA, or if the requirement
is otherwise contrary to regulations of the United States Department
of Housing and Urban Development governing FHA insured first mortgage
loans.
(5) The agency may use up to 5 percent of the funds appropriated
by the Legislature for purposes of this chapter to administer this
program.
(6) For purposes of this section, "transit-oriented development
specific plan area" means a specific plan that meets the criteria set
forth in Section 65451 of the Government Code, is centered around a
rail or light-rail station, ferry terminal, bus hub, or bus transfer
station, and is intended to achieve a higher density use of land that
facilitates use of the transit station.
(b) In addition to the downpayment assistance program authorized
by subdivision (a), the agency may, at its discretion, use not more
than seventy-five million dollars ($75,000,000) of the funds
available pursuant to this chapter to finance the acquisition of land
and the construction and development of housing developments, as
defined in Section 50073.5, and for-sale residential structures
through short-term loans pursuant to its authority pursuant to
Section 51100. However, the agency shall make downpayment assistance
provided pursuant to paragraph (1), subparagraphs (A) and (B) of
paragraph (2), and paragraphs (3) to (5), inclusive, of subdivision
(a) the priority use for these funds. A loan made pursuant to this
section is not subject to Article 4 (commencing with Section 51175)
of Chapter 5.