California Lawmakers Propose Zero Down, No Payment Home Loans For illegal Immigrants

In a recent proposal, California lawmakers have introduced a bill, Assembly Bill 1840, to expand the state’s zero-down, no payment home loan program to illegal immigrants.

This move has sparked a heated debate, with critics arguing that it is a misguided approach to addressing housing issues in the state.

In this article, we will explore why this proposal is a terrible idea and why the needs of California citizens should take precedence over those of illegal immigrants.

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Housing shortage and high home prices: California currently ranks 49th in housing units per resident, resulting in an acute shortage of affordable housing. The state’s housing production has not kept pace with its population and demand, leading to skyrocketing home prices. The proposed expansion of the home loan program would only exacerbate the issue, as it would increase demand for housing without addressing the root cause of the problem – the lack of supply.

Prioritizing illegal immigrants over citizens: State Sen. Brian Dahle has expressed his concerns about Assembly Bill 1840, stating that it is an insult to California citizens who are being priced out of homeownership. He believes that the state should prioritize helping first-time homebuyers who are in the country legally before extending such benefits to illegal immigrants.

Increasing costs and potential influx of illegal immigrants: With the reinforcement of the Texas Border, illegal immigrants are now redirecting to the California and Arizona borders, raising concerns about the state’s provision of healthcare and unemployment benefits to illegal immigrants. The expansion of the state’s MediCal taxpayer-funded free-to-low-cost healthcare system to all illegal immigrants is expected to cost $3.4 billion, and this cost could increase if more illegal immigrants arrive and sign up for the program.

Economic impact on California taxpayers: The California Dream for All Shared Appreciation Loans program, which started in 2023 with $300 million for 2,300 applicants, ran out of funds in just 11 days. This year, the program will require applicants to be first-generation home buyers and reduce maximum income thresholds to 120% of county median household income. The cost of the program is borne by California taxpayers, who are already struggling with the high cost of living in the state.

Potential for abuse of the system: The program allows applicants to secure “loans” of up to 20% of a home’s purchase price with zero down payment to the California Housing Finance Agency and no payments on the “loan.” The state’s “loan” can be repaid when the home is refinanced, sold, or transferred, with the borrower paying back the original loan amount plus 20% of any increase in value on the property. However, there are no provisions on how long a property can be held for, which raises concerns about the state’s ability to recover its money if a family decides to hold on to the home indefinitely.

In conclusion, the proposed expansion of the home loan program to illegal immigrants in California is a terrible idea that fails to address the root cause of the state’s housing crisis and puts the needs of illegal immigrants before those of California citizens. The state should focus on increasing housing production and providing affordable housing to its legal residents before extending such benefits to those who are in the country illegally.

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