Long Beach, CA: Second Mortgage Assistance Program
Filed under: Loans, 1st Time Homebuyers
The Long Beach Housing development Company (LBHDC) offers a program to promote neighborhood stabilization through increased home ownership opportunities, specifically for the benefit of persons and families of low- and moderate-income. This program is the Second Mortgage Assistance Program. The second mortgage assistance is in the form of a secured subordinate mortgage with contingent, deferred interest. The loan proceeds are used toward the purchase price of a single-family residence, condominium, or townhome located within the City of Long Beach Redevelopment Project Areas. The maximum purchase price for this program is $332,500 for condominiums/townhomes and $500, 650 for single-family homes.
The Long Beach Housing Development Company’s Second Mortgage Assistance Program is designed to be gap financing. The loan among is computed as the difference between the purchase price and the sum of the largest first trust deed mortgage deemed affordable to the borrower and borrower’s down payment. The interest rate is contingent, deferred interest in the form of equity sharing equal to the percentage which the Second Mortgage Assistance represents of the original purchase price, reduced for each full ear which the borrower owns and occupies the property. All interest is forgiven after 30 years of continuous occupancy. There are no fees to the borrower for this loan, but the borrower must contribute 1% of the purchase price from their personal funds as a down payment. Any down payments funds in excess of 1% may consist of any combination of gifts, grants or unsecured loans.
The borrower requirements are:
- Must be a first-time homebuyer: have not owned a home in the last three years.
- Borrower must live or work in Long Beach or show evidence of a job offer in Long Beach at time of application.
- The borrower must complete an 8-hour Homebuyer Education Class.
- The borrower must qualify for a 30-year fixed rate, first trust deed mortgage, in an amount not less than 30% of the purchase price, from an institutional lender approved by the LBHDC. Co-signers are limited to those that will reside in the property.
For more information on this program, go to www.lbhdc.org
