CA AB1551

Authorizes the Department of Housing and Community Development to allow CalHome Program downpayment assistance loans to be subordinated to refinancing if the borrower demonstrates hardship, subordination is required to avoid foreclosure, the new loan meets underwriting requirements, and the borrower lacks sufficient equity to repay the loan.

Permits the California Housing Finance Agency to subordinate downpayment assistance loans under the Home Purchase Assistance Program to refinancing under the same criteria (demonstrated hardship, foreclosure avoidance, underwriting approval, and insufficient borrower equity).

Extends subordination authority to downpayment assistance loans made under the Extra Credit Teacher Home Purchase Program and other school personnel home ownership assistance programs administered by the agency, subject to identical requirements and conditions.

Takes effect immediately as an urgency statute to enable underwater homeowners to participate in the federal Home Affordable Refinance Program (HARP) at the earliest possible time.