California has dealt with illegal immigrants for the past decade, but as time goes on, it has found a way to incorporate some into its society. However, despite this acceptance, some still struggle to find housing in the state.
However, this problem is about to change permanently as a California lawmaker makes efforts to make housing more affordable for immigrants. How will he do it? By tweaking a popular state-backed program.
Understanding The Undocumented Immigrants Issue In California
Most states in the US, like Arizona and Texas, try different methods to push illegal immigrants from their state. So why does California accept them? Surprisingly, nearly one in ten workers in California are undocumented immigrants.
In other words, they’re a core part of California’s workforce, consisting of around 1.75 million people. With these kinds of stats, researchers dub California as the second-highest state occupied by illegal immigrants. Nevada is number one.
How Can They Buy A House If They’re Illegal?
Readers online question why undocumented people can buy a house in America. One social media user asks: “It’s against the law to enter America without the right papers. So why can they get a house?”
The answer is simple: there’s no law that says they can’t buy a home in the US. Since this clause doesn’t exist on paper, hardworking immigrants can own real estate. The only problem is financing because the requirements are tricky for them to meet.
Joaquin Arambula To The Rescue
Despite being undocumented, these immigrants are crucial to California’s economy and should be treated better. So, Assemblymember Joaquin Arambula, D-Fresno, has made efforts to make housing more accessible.
This goal is possible through California’s home loan program that regularly assists people with home down payments. The money comes from a $250 million subsidy aimed to help lower-income households find a place to live.
About The California Dream For All Program
Before proceeding, it’s crucial to understand this state-backed home loan program. This initiative is called “Dream For All,” and it uses a shared appreciation lending model to finance people’s homes.
California’s government created the Dream for All Program to tackle the state’s wealth gap between races. Anyway, successful applicants get up to 20% of the home’s price for a down payment of $150,000. Afterward, homeowners can pay back the loan after selling the house later.
The Changes Arambula Proposes
Arambula introduced Assembly Bill 1840 to expand eligibility for the Dream for All program. The bill will replace the “first-come, first-served model” like the lottery. The program also requires applicants to be first-generation homebuyers.
By only allowing first-generation homebuyers, the money will go to people who genuinely need a home. So, the rich can’t use this option to further enrich their pockets. Lastly, the bill lowered the program’s eligibility criteria from 150% to 120% of the county’s median area.
‘This Program Will Strength Economic Development’
The Assemblymember is confident that these changes are a step in the right direction. Not only will it tackle the homelessness issue, but it will also encourage economic development.
In Arambula’s own words: “The program is crucial in making homeownership more attainable and strengthening the economic development and quality of life for all our communities.” So, his goal isn’t merely immigrants but everyone who needs a place to call home.
The Program Was A Little Too Successful Last Year
California’s Dream For All program went live last year, 2023. While it achieved its purpose, it worked a little too well. Desperate homebuyers claimed the $300 million loan pool in 11 days. Also, data from the program raised some concerns.
Most people using the initiative can already afford a home and are merely exploiting the “free money.” This problem led the appropriate authorities, alongside Arambula, to push for the necessary changes.
Only 22% Of Undocumented People Own A Home
Despite being almost 10% of California’s workforce, only a tiny portion own a home. Statistics show the number to be around 604,000 (22%) of the undocumented population in California.
Why such few numbers? One reason is that they don’t have the proper documents for big loans. Another reason is income, as most asylum seekers rarely have enough money to pay for a home.
Undocumented Homeowners $3.6 Billion In Taxes
The few undocumented immigrants who own homes generate nearly four billion dollars for the nation’s economy. But how come? These people aren’t documented and have no identification for taxes.
Actually, the government already found a way to ensure these hard workers pay their dues. This is possible by issuing an individual tax identification number or ITIN. Therefore, foreigners can pay their taxes, open bank accounts, and qualify for a mortgage.
Down Payments And Interest Rates Are Higher
Getting housing as an undocumented immigrant is tricky, even if you get an ITIN. Why? Because most loan companies fear the risk of working with such people is high, so they raise their interest rates.
This interest rate creates a barrier that prevents many foreigners from accessing appropriate housing. What’s worse is that down payments also increase for illegal immigrants to either scare them or ensure they can pay.
Arambula’s Bill Will Change Lives
The new adjustments to California’s Dream For All program will change lives. People in need can fairly capitalize on the opportunity thanks to the lower eligibility criteria. The lottery-style selection process also ensures only low-income individuals get the down payment assistance.
Franco Garcia, a Sacramento realtor, commented on the news. He said: “If there was a less burdensome entry point, I think many more people would buy.”
This Change Will Also Improve California’s Economy
If successful, Arambula’s changes will slowly improve the housing market in California. Essentially, millions of people now being able to afford a house equals increased demand for accommodation.
Therefore, developers and contractors can invest more resources in California’s real estate market. Also, this initiative will help California maintain its status as the state with the highest GDP of $3.5 trillion.
No One’s Against This Bill
Most American bills pass through a lot of scrutiny before getting implemented. So far, there’s no news of other authorities opposing the proposal. While a few online forums question the need to help illegal immigrants, the voices are few.
Therefore, it’s safe to assume that Arambula’s Assembly Bill 1840 may get approved. The reasoning behind the change goes beyond empathy for immigrants but also for the nation’s future. By implementing his proposal, housing becomes more accessible, and California keeps growing.
