New Loan Program Offers San Francisco Residents $2 Million Mortgage With No Down Payment

San Francisco continues to prove itself as one of the least affordable cities in the country for the middle class and any individuals falling below that line. In early December, the San Francisco Federal Credit Union’s newest offering went live on their site. Called the “POPPYLOAN” (Proud Ownership Purchase Program for You), this loan is not for everyone — rather, it’s only right for people who can afford a monthly mortgage payment on a $2 million house.

Naturally, this excludes a great deal of people.

“We have programs to help low-income people, but for the vast majority of young professionals, there is no hope or no help for this middle-class band in San Francisco,” said Rebecca Reynolds Lytle, San Francisco Federal Credit Union’s senior vice president and chief lending officer. Currently, the credit union has 34,000 members.

In order to qualify for the loan, the borrows must have a job in either San Francisco or San Mateo County, and must be utilized for purchasing a primary residence.

Under its stipulations, it cannot be used for refinancing. Unlike other housing loans, there is no mortgage payment required. It is a 5/5 adjustable rate offering — this means it can only be adjusted every five years, unlike most that change annually.

Over the past decade or so, real estate in San Francisco has skyrocketed. According to, the median home price in San Francisco was $1.1 million, an 11% increase from just one year prior. Additionally, it is around five times the median of national value.

“What we would pay here for a down payment you could take to another market and pay cash for a house,” Lytle added.

But again, these loans are not for just anyone. Larger banks in the area have a larger and more diverse customer base, and offer products catered to lower-income demographics. There are also lending options, such as FHA K loans, that offer down payments as low as 3.5%.

Yet many San Franciscans would argue with the notion that their city has become largely unaffordable. In a recent San Francisco Examiner article, Peter Cohen and Fernando Marti argue that the city is experiencing the most massive urban construction era since the urban renewal. To boot, more than half of what is being built should be “affordable housing to keep up with job growth.”

They add, “According to the San Francisco General Plan Housing Element, about 4,100 total homes should be constructed annually to fully meet The City’s growing population needs at all income levels. Of that total, 57 percent of new homes (about 2,330 units per year) should be affordable to low- and moderate-income San Franciscans (aka, below market-rate).”

So whether you’re jonesing for a $2 million mortgage for a lender’s loan, or are seeking affordable housing, it seems there’s something for everyone popping up in San Francisco.

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