BILL NUMBER: SB 2197	CHAPTERED  09/05/00

	CHAPTER   307
	FILED WITH SECRETARY OF STATE   SEPTEMBER 5, 2000
	APPROVED BY GOVERNOR   SEPTEMBER 1, 2000
	PASSED THE ASSEMBLY   AUGUST 18, 2000
	PASSED THE SENATE   MAY 25, 2000
	AMENDED IN SENATE   MAY 11, 2000
	AMENDED IN SENATE   MAY 1, 2000

INTRODUCED BY   Senator Soto

                        MARCH 16, 2000

   An act to amend Sections 51345 and 51348 of the Health and Safety
Code, relating to housing.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 2197, Soto.  Home purchase assistance.
   The Roberti-Greene Home Purchase Assistance Program, administered
by the California Housing Finance Agency, requires (1) that the
amount of home purchase assistance not exceed the amount necessary to
make the total debt financing affordable to eligible households, (2)
that the principal and interest that is due be reduced if the
proceeds of a sale are insufficient to reimburse the original
downpayment, and (3) that not more than 50% of the assistance be
provided for homes not previously occupied.
   This bill would repeal requirements (1) and (2) above, and recast
requirement (3) as an expression of the intent of the Legislature.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  Section 51345 of the Health and Safety Code is amended
to read:
   51345.  (a) The agency shall administer a home purchase assistance
program in accordance with this chapter.  The purpose of the home
purchase assistance program is to assist first-time homebuyers to
utilize existing mortgage financing available pursuant to this part
or Division 4 (commencing with Section 800) of the Military and
Veterans Code with the additional financial resources made available
pursuant to Part 8 (commencing with Section 53130).
   (b) Home purchase assistance under this chapter shall include, but
not be limited to:  (1) an interest rate subsidy to reduce the
interest rate, (2) a deferred-payment, low-interest, second-mortgage
loan to reduce the principal and interest payments, and (3)
downpayment assistance to make financing affordable to first-time
homebuyers.
   (c) In no case shall the interest rate subsidy reduce the
effective interest rate to the borrower below 3 percent per annum,
nor shall the deferred-payment, low-interest, second mortgage loan
exceed 49 percent of the total debt financing necessary to purchase
the home.
   (d) The amount of home purchase assistance shall be a second
mortgage loan secured by a deed of trust of second priority to the
primary financing provided by the agency or the Department of
Veterans Affairs.  The term of the home purchase assistance shall not
exceed the term of the primary loan.
   (e) The amount of home purchase assistance shall be due and
payable at the end of the term, upon the sale of the home, or upon
refinancing.  The borrower may refinance the mortgages on the home if
the principal of and accrued interest on the second mortgage loan
securing the home purchase assistance are repaid in full.  All
repayments shall be deposited in the fund.
  SEC. 2.  Section 51348 of the Health and Safety Code is amended to
read:
   51348.  It is the intent of the Legislature that no more than 50
percent of the home purchase assistance provided under this chapter
shall be for the purchase of homes that have not been previously
occupied.