California Opens Third Round of $150,000 Down Payment Program

California’s Dream For All program began accepting applications Tuesday for its third round, offering first-generation homebuyers up to $150,000 in down payment assistance through a statewide lottery.

The program, administered by the California Housing Finance Agency, provides loans of up to 20% of a home’s purchase price to help with down payment and closing costs. Applications are open through March 16. For buyers in Pasadena and Altadena — where median home values exceed $1 million — the assistance could cover a significant share of a down payment, though demand has historically far outpaced the program’s funding.

CalHFA expects to make $150 million to $200 million available this round, enough to help an estimated 1,500 to 2,000 households statewide, according to a CalHFA press release. The 2025-26 state budget allocated $300 million for Dream For All overall, which also covers applicants from a prior waitlist.

Unlike the program’s first round in March 2023, when $300 million was exhausted in 11 days on a first-come, first-served basis, this round uses a randomized lottery. Applicants who submit complete applications by March 16 will have an equal chance of selection regardless of when they applied, according to CalHFA.

To qualify, at least one borrower must be a first-generation homebuyer — defined as someone whose parents do not currently own a home. All borrowers must be first-time buyers and California residents. Household income in Los Angeles County, which includes Pasadena and Altadena, must not exceed approximately $168,000, according to CalHFA.

“The California Dream For All program has already helped thousands of Californians buy their first home,” Tony Sertich, executive director of CalHFA, said in a statement. “As these homeowners begin to repay their loans, the funds are reinvested into the program to create a cycle that will continue far into the future.”

The repayment mechanism is central to the program’s design. When borrowers sell or refinance their homes, they must repay the original loan amount plus 15% to 20% of the home’s appreciated value. CalHFA has said those funds are recycled to assist future applicants.

The program has assisted approximately 4,100 borrowers statewide in its first two rounds, according to media reports citing CalHFA data. But in a state of nearly 40 million people facing a severe housing affordability crisis, at least one mortgage professional questions whether the program’s scale matches the need.

Rajat Jetley, an Orange County-based mortgage officer who has worked with dozens of Dream For All clients, said he has noticed interest tapering ahead of this third rollout.

“It’s possible people have done the math and figured out even with 20% it’s still a sizable payment that they don’t feel comfortable making,” Jetley told the Orange County Register. “It’s still outside their budget.”

Jetley, who praised the program’s benefits for those who qualify, attributed the cooling interest to persistently high home prices across California.

“Is it a good program? Absolutely,” Jetley told the Orange County Register. “In terms of solving the housing crisis, the supply side would be the side that they should really be targeting.”

Applicants must obtain a pre-approval letter from a CalHFA-approved lender before applying. CalHFA also requires completion of an eight-hour homebuyer education and counseling course. Those selected in the lottery will have 90 days to find a home and close.

To apply, visit calhfa.ca.gov/dream/#nextsteps. The application window closes March 16. For more information, call 877-922-5432.

The program’s return comes as Pasadena and Altadena continue to face some of the region’s steepest housing costs. At current local prices, a $150,000 loan would cover roughly 14% of a median-priced Pasadena home — enough to substantially reduce a monthly mortgage payment, but still requiring the buyer to finance more than $900,000.