Millions available to help San Diegans buy homes

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SAN DIEGO — Eileen Gomez was living with her mother and sister in a mobile home when she made a promise to herself.

“I didn’t want to sit there and be stuck, so I said I was going to find a way to own a house,” she said.

In San Diego’s tight real estate market, that’s easier said than done. Homeowners often put their home on the market and get several offers above the asking price. Gomez, who works in retail in Mission Valley, didn’t let that stop her.

She discovered a program through the San Diego Housing Commission that will lend eligible first-time buyers up to 22% of a home’s purchase price as a down payment. To be eligible, she had to find 3% on her own, which involved sacrifices.

“It was very hard to see your friends go out, it was very hard not to have the latest things like the latest cell phone, the most beautiful car, you have to stay grounded, focus and save your money,” said Gomez.

Gomez came with the money and applied for the commission. In December 2020, she purchased a two-bedroom, two-bathroom condo in the College area for $350,000.

The program is open to households earning 80% of the region’s median income or less. For example, a three-person household earning up to $87,300 per year would qualify to borrow up to $150,000 for a down payment. This would increase their purchasing power from $470,000 to $680,000.

The down payment loan, a second mortgage at 3% simple interest, is not repaid monthly. Instead, it is due in full in 30 years, upon sale or if the owner no longer occupies the house as a principal residence. There is also up to $10,000 in grant funding for closing costs available.

Sujata Raman, vice chair of the single-family housing finance commission, said with market prices rising so rapidly, participants typically sell their homes and move out within 7 to 9 years.

“Borrowers can make payments, but generally what happens is that borrowers refinance their mortgage at some point and convert the second mortgage into a first mortgage and pay us back, or the loan matures when the sale of their property,” Raman said.

The commission has $4.9 million for San Diegan residents to apply for.

As for Gomez, Zillow estimates that the value of his condo has already increased by $109,000. She hopes the equity will help her buy a bigger house to raise her three children.

“Now that everyone is complaining about the price hike, it’s like, wow, that’s a relief,” she said. “I have something of my own now.”

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