20250AB__238799INT INTRODUCED 2026-02-20 2025 AB INT Introduced by Assembly Member Alvarez LEAD_AUTHOR ASSEMBLY Alvarez

An act to amend Sections and of, and to add

Section 51529.5 to, the Health and Safety Code, relating to housing, and making an appropriation therefor. housing, and making an appropriation therefor California Dream for All Program: first-generation homebuyers. Existing law establishes the California Housing Finance Agency in the Business, Consumer Services, and Housing Agency, and, as of July 1, 2026, transfers the agency to the California Housing and Homelessness Agency created pursuant to the Governor’s Reorganization Plan No. 1 of 2025, as provided.

Existing law authorizes the agency to, among other things, make loans to finance affordable housing, including residential structures, housing developments, multifamily rental housing, special needs housing, and other forms of housing, as specified. Existing law establishes the California Dream for All Program, administered by the agency subject to the availability of funds, to provide shared appreciation loans, as defined, to qualified first-time homebuyers. Existing law limits the program to providing assistance to low- and moderate-income homebuyers in the purchase of owner-occupied homes.

Existing law establishes the California Dream for All Fund, and continuously appropriates moneys in that fund for the purposes of the program, as prescribed. This bill would require the agency to expand the California Dream for All Program to provide additional assistance, as specified, to first-generation homebuyers, as defined.

The bill would require the agency to prioritize this assistance to first-generation homebuyers purchasing homes built using specified state funding, and to expedite approval of that assistance for a first-generation homebuyer purchasing a home located in a moderate-density area, as provided. By expanding the purposes for which money in the California Dream for All Fund may be used, the bill would make an appropriation.

The bill would additionally establish the Credit-Enhancement and Guarantee Fund for the purpose of distributing this assistance to specified first-generation homebuyers and would, upon appropriation, require the agency to align the distribution of funds with relevant government-sponsored enterprise pilot programs, as defined, focused on expanding access to credit for first-generation borrowers.

Existing law requires the agency to convene a working group to develop recommendations to assist homeowners in qualifying for loans to construct accessory dwelling units and junior accessory dwelling units on their property and to increase access to capital for homeowners interested in building accessory dwelling units. This bill would require that working group to explore opportunities for first-generation homebuyers to use funds from the expanded California Dream for All Program as down payment assistance for small-plex or accessory dwelling unit ready properties.

TWO_THIRDS YES YES NO NO NO NO NO NO NO NO The people of the State of California do enact as follows:

SECTION 1.

Section of the Health and Safety Code is amended to read: 51522. For the purposes of this chapter: (a) “Community development financial institution” means any community development financial institution certified by the federal Community Development Financial Institutions Fund under

Part 1805 (commencing with

Section 1805.100) of

Chapter XVIII of Title of the Code of Federal Regulations. (b) “First-generation homebuyer” means a first-time homebuyer whose parents neither have, nor have had, an ownership in a principal residence. (a)</xhtml:p>"?> (c) “First-time homebuyer” has the same meaning as defined in

Section 50068.5. (b)</xhtml:p>"?> (d) “Fund” means the California Dream for All Fund. (c)</xhtml:p>"?> (e) “Government-sponsored enterprise pilot program” means any temporary program, initiative, or guideline established by the Federal National Mortgage Association (Fannie Mae) or the Federal Home Loan Mortgage Corporation (Freddie Mac), in accordance with their duty-to-serve obligations or other regulatory mandates, that is designed to increase homeownership access for first-generation homebuyers through features such as reduced down payments, alternative underwriting criteria, or partner assistance programs. (f) “Program” means the California Dream for All Program. (d)</xhtml:p>"?> (g) “Shared appreciation loan” means a deferred-payment subordinate mortgage loan, the repayment of which is based on the amount of the subordinate loan plus the appreciation in the value of the home financed by the loan from the time of purchase to the time the home is sold or refinanced. (h) “Small-plex” means a residential property containing two to four, inclusive, dwelling units.

SEC. 2.

Section of the Health and Safety Code is amended to read: 51524. (a)

(1) There is hereby established in the State Treasury the California Dream for All Fund.

(2) Notwithstanding

Section of the Government Code, all moneys in the fund are continuously appropriated to the agency, without regard to fiscal years, for expenditure pursuant to this

chapter and defraying administrative costs of the agency.

(3) Notwithstanding

Section 16305.7 of the Government Code, any interest earned or other increment derived from investments made from moneys in the fund shall be deposited in the fund. (

b) Moneys deposited in the fund may include appropriations from the Legislature from the General Fund or other state fund, proceeds from the agency issuing revenue bonds for the purposes set forth in this

chapter pursuant to

Section 51350, the sale or issuance of any debt instrument secured by repayment of loans originated pursuant to this chapter, and repayments from the program. (c)

(1) There is hereby established in the State Treasury the Credit-Enhancement and Guarantee Fund for the purpose of distributing the assistance in

Section 51529.5 to first-generation homebuyers with federal individual taxpayer identification numbers or thin credit files and mortgages originated by mission lenders or community development financial institutions. Upon appropriation, the agency shall align the distribution of this assistance with relevant government-sponsored enterprise pilot programs focused on expanding access to credit for first-generation borrowers.

SEC.

Section 51529.5 is added to the Health and Safety Code , to read: 51529.5. (

a) The agency shall expand the program to additionally serve first-generation homebuyers by providing either of the following:

(1) Grants in the form of forgivable deferred loans to first-generation homebuyers whose income does not exceed percent of the area median income.

(2) Shared-appreciation loans to first-generation homebuyers whose income exceeds percent of the area median income. (

b) The agency shall prioritize assistance described in subdivision (

a) for first-generation homebuyers purchasing homes constructed using state-funded infill and starter home production programs. (

c) The agency shall expedite approval for assistance described in subdivision (

a) for a first-generation homebuyer purchasing a home located in a moderate-density area. (

d) The working group established pursuant to

Chapter 13 (commencing with

Section 51530) shall explore opportunities for first-generation homebuyers to use assistance from subdivision (

a) as down payment assistance for small-plex or accessory dwelling unit ready properties.