California Governor Gavin Newsom vetoed a bill on Friday that would have allowed undocumented immigrants to apply for home loans for the first time in the state.
In his veto message, Newsom explained that given the limited funding available for the California Housing Finance Agency (CalHFA) programs, expanding eligibility must be carefully weighed against the broader state budget to manage resources effectively.
Victor Narro, an advocate for immigrant rights and labor, criticized Newsom’s decision. He argued that the veto was based on a flawed premise, noting that Assembly Bill 1840 (AB 1840) would have allowed undocumented immigrants to qualify for an existing homebuyers program they already contribute to through their taxes.
The veto comes just one day after former President Donald Trump stated in an interview with the Wall Street Journal that he would ban home mortgages for undocumented immigrants if re-elected. Trump claimed that undocumented immigration drives up housing costs and asserted that his plan would prevent “illegal aliens” from obtaining mortgages.
Senator Brian Dahle, who represents Northern California’s Redding area and ran against Newsom in the 2022 gubernatorial race, suggested that Newsom’s veto was politically motivated. Dahle claimed that Newsom’s decision was influenced by national ambitions and potential voter backlash.
Details of Assembly Bill 1840
AB 1840 aimed to make California the first state to offer home loans to undocumented immigrants. The bill sought to amend the California Dream for All Shared Appreciation program, which provides no-interest loans of up to $150,000 to cover down payments and fees for first-time homebuyers.
Under the bill, applicants meeting the program’s requirements, including having Social Security and Taxpayer Identification numbers, would not be denied a loan due to their immigration status. The California Senate approved the bill by a 23-11 vote in August, with some Democrats abstaining. The Assembly subsequently voted 45-15 in favor of the Senate’s version.
California Dream for All Shared Appreciation Program
Launched in 2023 by the California Housing Finance Agency, the California Dream for All Shared Appreciation program supports low- and middle-class buyers by assisting with down payments and fees for first-time homebuyers.
Opposition to the Bill
Following the bill’s approval by the Legislature, opponents quickly called for a veto. Senate Republicans argued that extending the loan program to undocumented immigrants was inappropriate given the existing demand from citizens and the program’s limited funds. The California Housing Finance Agency confirmed that it had exhausted its allocated funding.
Senate Minority Leader Brian Jones, R-San Diego, questioned whether it was appropriate to provide loans to undocumented immigrants when many legal residents struggle to afford homes. He also warned that the bill might attract more undocumented immigrants to California.
Support for the Bill
Assemblymember Joaquin Arambula, D-Fresno, the bill’s author, argued that homeownership benefits should be accessible to all, regardless of immigration status. He emphasized that expanding loan access would contribute positively to California’s economy and success.
State Senator Anna Caballero, D-Merced, noted that the bill would have helped many undocumented immigrants, some of whom were essential workers during the COVID-19 pandemic, to purchase their first homes. She also pointed out that the loan program would have required additional funding to meet demand if the governor had signed the bill.
