The Federal Home Loan Bank’s WISH program is designed to encourage and leverage homebuyers who accumulate down payments. As a designated program administrator, First Home, Inc. recruits and prepares qualified homebuyers in the Bay Area to receive matching forgivable loans from one of FHLB’s participating member banks, First Republic, Fremont, and Gateway. The program achieves its objectives by offering down payment assistance and by requiring FHLB’s member banks to offer additional incentives or discounts.
Down Payment Assistance – Both the WISH and IDEA programs provide a three-to-one match to down payment funds a homebuyer deposits toward purchase of a home, up to $15,000. The match is a forgivable loan. If the home is sold or refinanced the home before the end of a five-year “retention period,” a pro rata portion of the loan must be repaid; otherwise, at five years the loan is forgiven.
Down payment requirement - The WISH program requires that at least 1% of the home purchase price come from the buyer directly. The WISH program allows the buyer to obtain the $5,000 applied towards the $15,000 FHLB match to come from any source. In contrast, since the objective of the IDEA program is to encourage and reward savings toward a down payment, buyers are required to accumulate personal savings of at least $5,000 to able to use the maximum 3-to-1 matching loan of $15,000. Also, as with most loans, there will be closing costs associated with the loan and purchase of a property. The buyer should expect to pay between 2% to 3% of the property purchase price in closing costs.
IDEA program Features – the Individual Development and Empowerment Account matching loan is available to households who participate in a homebuyer education and savings management program for ten to twenty months. First Home, Inc. also offers a comprehensive education, counseling, savings, and debt management program (the WISE IDEA Program) to assist households in meeting their savings requirements. The purpose of this preparation period is to allow the buyer to work with credit and financial counseling partner—in First Home’s case, our non-profit partner, Springboard—to save up money for down payment and closing costs, and to reduce debt and improve credit to increase buying power.
WISH Program Features– the Workforce Initiative Subsidy for Homeownership matching loan is available immediately to qualifying homebuyers. However, WISH loans can only be used in conjunction with local down-payment assistance program such as those sponsored by a city, county, or an employer such as a school district. First Home helps buyers access these programs. At least 1% of down payment must come from personal funds.
First Time Homebuyer - buyer must be a first time homebuyer. This means having not owned a primary residence anywhere in the United States over the past three years.
Good Credit - buyer must have “good” credit.
Income Restrictions – buyers’ household income may not exceed 80% of the area median income, adjusted for household size.
Stable Income and Employment - buyer must be able to show two years of stable income and employment.
Cash/Savings for Closing costs - buyer must have at least 2% to 3% of the purchase price for closing costs.
First Home, Inc. is licensed by the California Department of Real Estate as a real estate lender mortgage broker.