Wells Fargo Home Mortgage, CaHLIF and Freddie Mac Address Lack of Affordable Housing for California's Teachers; Announce New Loan Program
DES MOINES — August 14, 2000
A new home financing program, designed to spur homeownership among California's educators, may receive an "A" from teachers throughout the state. The program, announced today by Wells Fargo Home Mortgage, Inc., the California Housing Loan Insurance Fund (CaHLIF) and Freddie Mac, allows teachers working within the state to purchase a home with a downpayment of just $500.
The program also offers teachers relaxed credit guidelines - making it easier to qualify for the program - and higher qualifying ratios, which allows homebuyers to qualify for more home. Wells Fargo Home Mortgage will be the exclusive provider of these loans; CaHLIF will provide downpayment assistance and mortgage insurance; and, Freddie Mac will purchase the loans. The program will be available in early September.
"This program caters to the needs of California's educators - the public and private school teachers that help prepare our youth for leadership in the 21st Century," said Dan Russell, executive vice president of emerging markets for Wells Fargo Home Mortgage. "We're making every effort to narrow the gap between California's teacher salaries and rising housing costs. This is definitely a step in the right direction. By making homeownership more affordable, we're helping more teachers in the state choose homeownership and invest in our communities."
A starting salary for a California public school teacher is $29,000 a year, according to the California Teachers Association, while the average teacher's salary is $44,000. Meanwhile, the median home price in California is $217,520, according to the California Association of Realtors.
Using this program, California educators, including public and private school teachers, substitutes, administrators and childcare providers, can finance a new or existing home with only a $500 downpayment.
While California educators will only need $500 for a downpayment, the remaining downpayment will be funded by CaHLIF in the form of a 3 percent simple interest loan with payment deferred until the end of the loan term, or when the home is sold or refinanced.
"The state of California is committed to assisting educators achieve the dream of homeownership," said John Schienle, director of CaHLIF. "This program will go a long way in helping our educators realize the dream, as well as our efforts to retain and recruit a talented workforce. We are grateful for the support, resources and expertise of our partners Wells Fargo Home Mortgage and Freddie Mac."
California educators interested in the program will have the option of selecting either a 25- or 30-year fixed-rate loan. There are no income limitations or property restrictions. Additionally, there are no experience levels or tenure required to be eligible for the program.
The program is available with mortgage loan amounts up to $252,700 - with no minimum loan amount - through more than 100 Wells Fargo Home Mortgage's California retail offices and Wells Fargo bank locations.
"Freddie Mac has long been committed to expanding affordable homeownership opportunities for California's teachers and the communities that depend on them to educate their children. We are delighted to work with Wells Fargo Home Mortgage to further increase the mortgage resources available to California's hard-working teaching professionals," said Michael Coffey, Freddie Mac's vice president of expanding markets.
For more information about the new teacher loan program and other mortgage products and services, call 1-800-222-3408 for the nearest Wells Fargo Home Mortgage location or CaHLIF at 916-322-8936.
Freddie Mac is a stockholder-owned corporation chartered by Congress in 1970 to create a continuous flow of funds to mortgage lenders. By supplying lenders with the money to make mortgages and packaging the mortgages into marketable securities, Freddie Mac sustains a stable mortgage credit system and reduces the mortgage rates paid by homebuyers. Over the year, Freddie Mac has opened the doors for one in six homebuyers in America and two million renters.
Based in Des Moines, Iowa, Wells Fargo Home Mortgage, Inc., is a subsidiary of Wells Fargo & Company (NYSE: WFC). It is a leading originator and servicer of residential mortgages. With a presence in more than 1,200 mortgage stores and Norwest/Wells Fargo bank locations serving all 50 states, Wells Fargo Home Mortgage operates the leading mortgage lending network in the country. Combined, its retail and wholesale lending operations provide funding for approximately one of every 15 homes financed annually in the United States.