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The POPPYLOAN Is Here to Help San Franciscans Buy Really Expensive Homes with Nothing Down


Home prices are getting expensive out there, especially in the Bay Area (Northern California) where inventory is low and demand is red hot.

But fear not, the San Francisco Federal Credit Union has a new product to help you buy a home there if you want in on the real estate boom.

Today, they launched their so-called “Proud Ownership Purchase Program for You” loan, known simply as POPPYLOAN.


  • A zero down home loan
  • Available to those who work in San Francisco or San Mateo County
  • Can purchase a property in any of the 9 counties in the Bay Area
  • Loan amounts up to $2 million with no PMI requirement

It’s more than just a snazzy name, it’s a home loan that allows those who work in San Francisco or San Mateo County to purchase a really expensive home with nothing down.

While zero down isn’t completely unheard of these days, their upping the ante by allowing loan amounts as high as $2 million, and doing this without requiring private mortgage insurance (PMI).

The POPPYLOAN can be used to purchase a home in nine Bay Area Counties, including Alameda, Contra Costa, Marin, Napa, San Francisco, San Mateo, Santa Clara, Solano, or Sonoma.

So I suppose the hitch is that you need to work in one of two counties (where the credit union is chartered) and purchase a home in one of nine. And I assume the salaries are pretty stellar in those two counties given all the tech jobs and sky-high rents.

In other words, the San Francisco Federal Credit Union won’t be handing out these rather risky sounding mortgages to just anyone.

In a press release, Senior Vice President and Chief Lending Officer Rebecca Reynolds Lytle called the new loan product a “game-changer” for the real estate market there.

She added that “too many” of its members had given up on the dream of homeownership thanks to rising home prices and hefty down payment requirements.

Apparently one-bedroom apartments can cost as much as $3,600 in the Bay Area, about the price of an $800,000 mortgage. So why rent if you can buy with nothing down?

That’s their argument. And they want to make it a reality by eliminating the down payment hurdle.


  • It only comes in one flavor, a 5/1 ARM
  • Probably with the expectation you’ll refinance or move
  • In a relatively short period of time
  • Since it targets HENRYs (High earners not rich yet)

There’s only one option when it comes to the POPPYLOAN. A 5/1 ARM that is fixed for the first five years before adjusting in year six.

It then adjusts every year after that until maturation in 30 years. The caps allow for a two percent increase in rate each time it adjusts and a maximum increase of six percentage points over the life of the loan.

I checked out their rates and they’re advertising a rate of 3% for the 5/1 ARM. But if you use their rate engine and select a POPPYLOAN with nothing down the rate rises to 4%. It is a zero down super jumbo loan after all.

That was with a credit score of 740 or higher. I selected under 620 (subprime) and it still offered the POPPYLOAN but with an initial rate of 5%. Incredible if they truly allow that.

The POPPYLOAN is only available on owner-occupied purchase loans and is not available to those looking to refinance.

However, you can get one on condos, townhomes, or 2-4 unit properties, and tenants-in-common (TICs) are also eligible.

They do require that borrowers impound insurance and taxes to ensure those get paid on a timely basis.

The San Francisco FCU charges a flat $1,700 loan origination fee for all mortgages but an additional amount if it’s a POPPYLOAN, based on these LTV tiers:

  • 80.01% to 85.00% LTV, fee of 0.375%
  • 85.01% to 95.00% LTV, fee of 0.75%
  • 95.01% to 100% LTV, fee of 1.00%

In other words, a $2 million POPPYLOAN would have an origination fee of $21,700 alone, not including other closing costs. Wowza!

So while it is a zero down loan, you’ll still need to bring some substantial money to the table if you’re buying a multi-million dollar home. As you should I suppose…

Those looking to take out a POPPYLOAN must be at least 18 years old and qualify for membership at the San Francisco FCU.

Pretty wild stuff here.  But unaffordable prices call for extraordinary financing options.  Let’s just try to be a little more careful this time around.

(photo: Tony Hisgett)

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