Buying your first home can be a nervous-making experience under the best of circumstances. These days, though, there are extra reasons to be concerned about one’s abilities to make the payments. Just look at the unemployment numbers.

The California Association of Realtors® (CAR) has introduced a program designed to help allay the exacerbated worries of first-time buyers in this economy. It is the CAR Housing Affordability Fund Mortgage Protection Plan, more easily referred to as the Mortgage Protection Plan or MPP. Under the MPP, first-time homebuyers who lose their jobs due to layoffs may be eligible to receive up to $1,500 per month, for six months, to help make their mortgage payments.

The cost to the buyer is zero. The program has received $1 million in funding from CAR’s Housing Affordability Fund. This fund has been in place for some years and has been used for programs ranging from Habitat for Humanity projects to providing seed money for low-cost housing developments. Its primary source of funds comes from donations by individual Realtors® and local Realtor® Associations.

To qualify for the program, applicants must meet a "first-time" homebuyer test similar to that of other programs. That is, they may not have owned a home during the past three years, or longer. Escrow must have opened April 2, 2009, or later, and must close on or before Dec. 31, 2009. The property must be in California. There are no limits on either the buyer’s income or the cost of the property. The buyer must be a W-2 employee, not self-employed, and cannot be an employee of a business or corporation that he or she owns or controls. The buyer must have been represented by an agent who is a member of the California Association of Realtors®.

The MPP is an insurance policy, and, as with any insurance policy, certain conditions apply. The most relevant ones are an initial vesting period and an "actively-at-work" requirement. The insured must have been enrolled for at least 6 months before a claim can be processed. Moreover, the insured must have been actively at work for at least 4 consecutive months before becoming eligible to file a claim. You can’t, for example, close escrow on your home and then file a claim three weeks later.

In the case where there is a co-buyer there is coverage of $750 per month for up to six months. The co-buyer must also qualify as a first-time homebuyer, e.g. a spouse who had owned a home two years ago would not qualify. Co-buyers need not be married or even related at all.

The policy also includes a $10,000 accidental disability or death benefit. There is no vesting period for the accidental death coverage.

An eligible first-time homebuyer or his/her Realtor® may obtain an application for coverage at . The claim must be submitted by the Realtor®.

Suppose you are a California buyer who opened and closed an escrow after April 2, 2009, that you qualify for the insurance, but you and your Realtor® were unaware of the program at the time. There is not a requirement that application must be made during the escrow period. Call your Realtor® now and get the application process going!