Owning a home has always been part of the American dream, and with mortgage interest rates at the lowest they've been in years, many residents of California are in the market to buy their first home or refinance an existing home.

The California Housing Finance Agency is just one of a number of government agencies determined to help future homeowners navigate the murky waters of home ownership. The agency assists buyers in achieving a FHA-insured loan, subject to meeting borrower requirements. These requirements include U.S. citizenship, meeting the credit, income, and loan requirements, and meeting the definition of a first-time home buyer: a borrower who has not purchased a home in the last three years. The insured loan is limited to $417,000. The California Housing Finance Agency also sets limits of the allowable fees charged by lenders for the FHA-insured loan.

Additionally, the California Department of Housing and Community development administers a number of programs that assist in making housing affordable to all California Residents. These programs include housing loan and grant programs to assist individuals purchase their first home.

Federal programs are also available to assist California residents. Freddie Mac, the federal enterprise tasked with ensuring that lenders have available money to lend, enabling buyers to afford housing, and stabilizing the mortgage markets. In 2010, Freddie Mac enabled almost 20,000 California residents to purchase their first homes, with an average mortgage of $285K. Freddie Mac also serves to introduce home buyers to organizations that can help them not only secure a loan, but also reduce their risk of becoming fraud victims.

Due to the size and diversity of the state, many residents of California live in high cost areas, including those in the San Francisco, L.A., and San Diego regions. Home buyers in these areas frequently take on home loans that are classified as jumbo mortgages. These jumbo mortgages frequently represent higher risk to the lender, and can require a higher down payment.

Many people are taking advantage of lower mortgage rates to refinance. Mortgage refinancing involves many of the same checks and documentation as purchasing a home, including credit checks and inspections of the home. Additionally, there are closing costs involved. It is important to speak with a mortgage specialist before refinancing.

With home mortgage rates at an affordable rate, many California residents are looking to buy their first home.