California Downpayment Assistance Programs to Buy a House
Down payment Assistance Programs
Dave Stapleton, Senior Loan Originator, First Choice Bank, NMLS # 248823
Millions of dollars of down payment assistance go unused each year in California… one reason why is because of the confusion many people (even experienced real estate and lending professionals!) have about these programs.
Each program comes with a distinctive set of criteria, including the way that homebuyers can qualify, and the way loans are processed and make their way through the system. Always consult your lender before making an offer on a home!
Myth: You can only qualify for assistance if you are a first time home buyer.
Fact: You do not have to be a first time homebuyer to participate! Many down payment assistance programs qualify buyers on other factors, such as sales price and income instead.
Myth: It is very difficult to qualify for homebuyer programs.
Fact: There are many options and opportunities! To qualify for an assistance program, the homebuyer and the property will have to meet certain criteria, which vary by program type. The key is doing research early in the home buying process and working with a trusted professional to go over each and every option. Standard criteria include property location, type of home, sales price limits, household income thresholds, and homebuyer education certifications. And remember that here are additional benefits, or even distinct programs, for educators, protectors, health care workers, veterans of the armed forces, and households with disabled members.
Myth: Using a down payment assistance program makes home financing more difficult.
Fact: This does not have to be the case! Lenders must go through training and meet a set of qualifications in order to work with these programs and use them to help their clients. This way the lenders understand these programs and know how to use them without complicating or prolonging the real estate transaction.
So what are my options?
There is a large number of state and local programs to work with…the important thing is to discuss these options with your lender. Read on to learn more about some of the most asked about programs.
Downpayment Assistance Programs
CalPLUS w/ ZIP EXTRA Homebuyer Assistance Program:
CalPLUS w/ ZIP is CAlHFA’s premiere homebuyer assistance program. This provides 3% in down payment assistance, reduced mortgage insurance premiums, and an extra $6,500 in assistance for first time home buyers. This program is available in both FHA and Conventional financing. Eligible buyers cannot exceed the county income limit. This program can even be layered with CHDAP (see below) for additional assistance.
CalHFA Conventional Loan Program
The CalHFA Conventional program is a first mortgage loan insured through private mortgage insurance on the conventional market. The interest rate on the CalHFA Conventional is fixed throughout the 30-year term.
CalHFA FHA Loan Program
The CalHFA FHA program is an FHA-insured loan featuring a CalHFA fixed interest rate first mortgage. This loan is fully amortized for a 30-year term.
Cal-EEM + Grant Program
The Cal-EEM + Grant program combines an FHA-insured Energy Efficient Mortgage first mortgage loan with an additional Cal-EEM Grant, making energy efficient improvements even easier. The interest rate on the Cal-EEM is fixed throughout the 30-year term. This is not limited to first time buyers, is available in all counties, and provides a grant (free money) to help you purchase a home.
MyHome Assistance Program
This program offers a deferred-payment junior loan of an amount up to the lesser of five percent (5%) of the purchase price or appraised value to assist with down payment and/or closing costs.
Extra Credit Teacher Home Purchase Program (ECTP)
CalHFA offers a first time home buyer program for Teachers, Administrators; school Staff, who work in a High Priority school in California. The ECTP provides $7,500 to $15,000 for down payment that has an interest forgiveness feature when employed at the school for at least three years.
Mortgage Credit Certificate Tax Credit Program (MCC)
The Mortgage Credit Certificate makes home ownership more affordable for first time home buyers by reducing a buyers federal income tax liability. This means that you may have more income to pay your mortgage or even qualify for a large loan!
California Homebuyer’s Down Payment Assistance Program (CHDAP) – Offered by the California Housing Finance Authority and available throughout all of CA. This program provides a 3% deferred ‘silent second’ loan that can be applied towards meeting part of FHA’s 3.5% or a Conventional 5% down payment requirement, or be used to pay closing costs. There are income restrictions based on which county and number of people in the household.
We are happy to help you further understand these programs and your other home financing options… please contact Dave Stapleton for more information.
For more information on all your options for down payment assistance programs, please send us a message by filling out the eligibility contact request below. We work with a team of real estate professionals and lenders who can help your dream of homeownership a reality.
Are you eligible for a first time home buyer downpayment assistance program?
There are California downpayment assistance programs available to help you buy a house with zero down payment or as little as .5% or 3% to 3.5% down payment. By giving us your permission to have a lender reach out to you, you will learn about the downpayment assistance programs available in California both for first time home buyers and non-first time home buyers that may be applicable in your situation.
If you have a reasonable credit, have a stable income, pay your bills on time in the last 12 months, but have no money for down payment, you need to find out if it is possible to buy a house with zero down payment using down payment assistance programs that you may be eligible for.
Please be sure to fill out our pre-approval contact request here to find out if you are eligible for downpayment assistance.