Overview: American Dream for All Act of 2025
| Bill Number | Chamber | Sponsor | Date Introduced |
|---|---|---|---|
| H.R.4023 | House | Rep. Salud O. Carbajal (D-CA-24) | June 17, 2025 |
The American Dream for All Act of 2025 is a housing bill that gives first-time, first-generation home buyers loans for down payments that are paid back via home appreciation. Loan sizes can range up to 20% of a purchase price and be paid back whenever the home is sold.
The American Dream for All Act was first introduced in the 119th Congress on June 17, 2025 in the House of Representatives. Its main sponsor is Rep. Salud O. Carbajal (D-CA-24).
The program is non-exclusive, which means it can be layered with other assistance programs such as the First-Time Home Buyer Tax Credit and the LIFT Act.
Fewer than 1 in 10 housing bills become law, and many change on their way to receiving a vote. This page will update as new details emerge. For real-time updates about the American Dream for All Act and other first-time home buyer programs, subscribe to our newsletter.
Bill Overview
American Dream for All Act of 2025
A bill to create a HUD-supervised pilot program where states, territories, and Tribes offer shared-appreciation down payment loans up to 20% of the home's purchase price to eligible first-time and first-generation home buyers.
Bill Overview
American Dream for All Act of 2025
A bill to create a HUD-supervised pilot program where states, territories, and Tribes offer shared-appreciation down payment loans up to 20% of the home's purchase price to eligible first-time and first-generation home buyers.
Official Title as Introduced
A bill to direct the Secretary of Housing and Urban Development to establish a pilot program to award grants to States, territories, and Indian tribes to provide down payment assistance loans to certain borrowers, and for other purposes.
House of Representatives
What is the American Dream for All Act?
The American Dream for All Act is a housing bill to create a down payment loan program for first-time, first-generation buyers. The bill proposes loans up to 20% of a home's purchase price for eligible buyers who enter into a shared-appreciation agreement with the lender.
Loans are repaid when the home is sold using a proportional share of home appreciation.
Here are the program's key eligibility requirements:
1. Must be a first-time, first-generation home buyer
The American Dream for All Act requires home buyers to meet the federal definition of a first-time home buyer, or be a first-generation home buyer.
A first-time home buyer is any person who, at no time in the last 36 months, owned the home in which they've made their main residence; and, a first-generation home buyer is someone whose parents or legal guardians do not own a home (or did not at the time of their death), and whose spouse or partner has not owned a home within the last three years.
The bill also extends "first-generation" to include people who were placed in foster care or institutional care at any point in their lives.
For households with more than one borrower, all co-borrowers must meet the bill's eligibility requirements.
Reference: Who qualifies as a first-time home buyer
| Scenario | First-Time Home Buyer? |
|---|---|
| Rented for the past 5 years, never owned a home | Yes |
| Sold a home 2 years ago, now renting | No |
| Lived in a family-owned home, never on the title | Yes |
| Owned a vacation cabin, never a primary residence | Yes |
| Gave up homeownership after a short sale 18 months ago | No |
| Previously owned a condo, sold it 4 years ago, now renting | Yes |
| Partner owned a home in the last 2 years, applicant did not | No |
2. Must meet income requirements
The American Dream for All Act is limited to moderate-income households. The program uses HUD's measure of area median income (AMI). There are no exceptions or higher limits for buyers in high-cost areas.
- Total household income must be at or below 150% of AMI
- Eligibility is based on combined household income, not just the borrower listed on the mortgage application
Use the Homebuyer.com Income Limits calculator to see income limits in your area.
Reference: 150% AMI in Select U.S. Cities
| City, State | 2024 AMI | 150% of AMI |
|---|---|---|
| San Francisco, CA | $186,600 | $279,900 |
| San Diego, CA | $119,500 | $179,250 |
| Phoenix, AZ | $101,300 | $151,950 |
| Los Angeles, CA | $98,200 | $147,300 |
| New York, NY | $97,600 | $146,400 |
3. Must purchase a residential property
Eligible home buyers must purchase an eligible residential home type which, for HUD, typically includes:
- Single-family homes
- Townhomes
- Condominiums and co-ops
- 2-4 unit homes
- Manufactured housing units
The bill cannot be used to purchase land only, mobile homes on leased land, or mixed-use buildings where residential is not the primary use. Homes must also meet structural and soundness requirements typical in mortgage guidelines.
4. Must occupy the home as a primary residence
The American Dream for All Act requires home buyers to occupy the home they purchase as their primary residence. Buyers must move into the home within 60 days of closing, and it cannot be used as a vacation property, rental property, or second home.
The home must serve as the buyer’s main dwelling where they live most of the year.
5. Must complete financial counseling
Before receiving assistance, buyers must complete homeownership education and individual counseling and obtain a certificate from a HUD-approved housing counseling agency. Education may be delivered online, by phone, or in person, but the counseling and certificate must come from a HUD-approved agency.
Courses like Fannie Mae’s HomeView and Freddie Mac’s CreditSmart Homebuyer U provide useful education and may be accepted by some mortgage programs; however, they do not replace the HUD-approved counseling and certificate requirement under the American Dream for All Act.
An approved HUD homeownership education and counseling program will cover the financial responsibilities of homeownership, fair housing rights, and the availability of post-purchase counseling.
6. Cannot put more than 5% down from own funds
Home buyers using the American Dream for All Act must certify that they cannot contribute, from their own money, more than 5% of the home’s purchase price for down payment, closing costs, and moving expenses.
The requirement is self-attested, which means bank statements and retirement accounts are not required. You simply state that this is your situation when applying for the loan.
The intent of the 5% Rule is to make sure the bill reaches home buyers who can manage a monthly mortgage payment, but find upfront costs to be too high. Having savings or retirement accounts does not automatically disqualify you.
The bill’s language focuses on liquidity -- not total net worth.
7. Must be a U.S. citizen or permanent resident
All borrowers must be U.S. citizens or permanent residents to qualify for the American Dream for All Act. Buyers with temporary visas such as student visas or H1B employees are not eligible.
How Does the American Dream for All Act Work?
The American Dream for All Act creates a federal pilot program run by states, territories, and Indian tribes. HUD provides oversight and funding to help first-time and first-generation buyers overcome upfront homeownership costs.
Money is distributed to states and Indian tribes through HUD
The program works through a federal-state partnership:
- HUD gives grants to eligible state and Tribal agencies
- States and tribes must maintain a revolving loan fund for down payment loans
- States and tribes give loans to eligible buyers
To make sure loans reach underserved communities, states and tribes must distribute funds through organizations with local homeownership expertise.
Allowable uses for the down payment loan
The American Dream for All Act provides up to 20% of a home's purchase price, up to local caps, to eligible buyers. Funds can be used for down payment and closing costs.
The most common use of the American Dream for All Act loan is for your down payment, which is often the largest obstacle to homeownership for first-time buyers. For example, if you buy a $400,000 home and use a 20% assistance loan, you could receive $80,000 for your down payment.
The loan can also be used to pay for closing costs and other expenses associated with purchasing a home.
📊 Key Statistic
Down payment loan are limited to a percentage of the purchase price, up to a local market cap
The American Dream for All Act gives down payment assistance loans up to 20 percent of a home’s purchase price, not to exceed a specific dollar amount set by HUD.
Program limits vary by market-size:
- Low-cost areas are capped at 20% of the purchase price, up to $50,000
- Medium-cost areas are capped at 20.0% of the purchase price, up to $100,000
- High-cost areas are capped at 20.0% of the purchase price, up to $150,000
Here is how program caps play out in different-sized cities.
Examples of Low-, Medium-, and High-Cost Cities
| City | Area Type | Maximum Loan Amount | Max Purchase Price to Max Out Loan |
|---|---|---|---|
| Cleveland, OH | Low-cost | $50,000 | $400,000 |
| St. Louis, MO | Low-cost | $50,000 | $400,000 |
| Birmingham, AL | Low-cost | $50,000 | $400,000 |
| Seattle, WA | Medium-cost | $100,000 | $500,000 |
| Denver, CO | Medium-cost | $100,000 | $500,000 |
| Boston, MA | Medium-cost | $100,000 | $500,000 |
| San Francisco, CA | High-cost | $150,000 | $750,000 |
| San Jose, CA | High-cost | $150,000 | $750,000 |
| Los Angeles, CA | High-cost | $150,000 | $750,000 |
HUD reviews these categories every year and adjusts the caps for inflation.
American Dream for All Act vs Other First-Time Buyer Programs
The American Dream for All Act is one of many first-time home buyer bills in Congress.
The bill stands out because it uses a shared appreciation model, which is not a part of other active bills. With a shared appreciation model, when you sell your home, the loan gets repaid plus a share of any increase in your home's value.
Also, because the bill's down payment assistance is based on a percentage of the home's purchase price instead of a flat dollar amount, buyers in high-cost areas can get support proportional to their local market prices..
Here's how the American Dream for All Act compares to other first-time buyer bill currently in Congress:
| Program | Type | Key Benefit | Income Limit (AMI) |
|---|---|---|---|
| American Dream for All Act | Loan | Up to 20% of price | 150% |
| Home of Your Own Act | Grant | Up to $30,000 | Up to 150% |
| Downpayment Toward Equity Act | Grant | Up to $20,000 | Up to 140% |
| American Housing and Economic Mobility Act | Grant | Up to 3.5% of price | Up to 140% |
| First-Time Homebuyer Tax Credit | Tax Credit | Up to $15,000 | 170% |
| Bipartisan American Homeownership Opportunity Act | Tax Credit | Up to $50,000 | 170% |
| HELPER Act | Mortgage | 100% LTV, No MI | 120% |
| LIFT Homebuyers Act | Mortgage | 20-year loan | Up to 140% |
| First Time Homeowner Savings Plan Act | IRA Withdrawal | Up to $25,000 | No limit |
| Uplifting First-Time Homebuyers Act | IRA Withdrawal | Up to $50,000 | No limit |
Who Sponsors the American Dream for All Act in Congress?
The American Dream for All Act of 2025 was introduced in the House of Representatives on June 17, 2025, by Rep. Salud O. Carbajal (D-CA).
For the latest legislative updates and a full list of cosponsors, see the Bill Tracker above.
Frequently Asked Questions About the American Dream for All Act
Get answers to common questions about the proposed American Dream for All Act, including eligibility requirements and how the shared-appreciation loan program works.
What is the American Dream for All Act of 2025?
The American Dream for All Act creates a federal pilot program providing shared-appreciation down payment loans worth 3%–20% of the home's purchase price to eligible buyers.
Who qualifies for the American Dream for All Act loans?
First-time or first-generation home buyers with income at or below 150% of area median income who cannot put more than 5% down from their own funds.
How much assistance does the American Dream for All Act provide?
The program provides 3%–20% of the purchase price, capped at $50,000 in low-cost areas, $100,000 in medium-cost areas, and $150,000 in high-cost areas, with annual CPI adjustments.
Do I make monthly payments on the assistance?
No. Repayment occurs when the home is sold: you repay the original assistance plus a matching percentage of the home's appreciation (if any). If the home sells for less than you paid, you repay only the original assistance amount.
How do I apply for the American Dream for All Act loan?
If the bill becomes law, eligible buyers will apply through their state or Tribal housing agency. States and tribes will administer the program under HUD oversight.
What types of homes are eligible under the American Dream for All Act?
The bill does not specify property types. Typically, HUD programs cover 1–4 unit homes, condos, co-ops, and manufactured housing that meet mortgage guidelines. Final eligibility will be determined by HUD.
When will the American Dream for All Act take effect?
The Act must pass Congress before becoming law. If enacted, HUD will establish the pilot program within 1 year.
How is the American Dream for All Act different from other down payment assistance programs?
The American Dream for All Act uses a shared-appreciation model where you repay based on home appreciation, recycling funds for future buyers.
Can I use the American Dream for All Act loan with other programs?
Yes. The American Dream for All Act allows combining the shared-appreciation loan with state, local, employer, nonprofit, and other federal housing programs.
What happens if my home loses value when I sell?
If the home sells for less than you paid, you only repay the original assistance amount—no additional payment for depreciation.
Do I have to pay for the required financial counseling?
No. HUD-approved housing counseling agencies provide free or low-cost options. Programs like Fannie Mae's HomeView and Freddie Mac's CreditSmart offer useful education, but you'll still need a HUD-approved counseling certificate.
Can I use the loan for a manufactured home?
Yes. The American Dream for All Act covers manufactured housing units that meet conventional, FHA, VA, or USDA loan requirements.
What if my income changes after I receive the loan?
Income is evaluated at application and closing. Changes after receiving the loan do not affect eligibility or require repayment.
