DOWN PAYMENT ASSISTANCE PROGRAMS
California down payment assistance programs and grants are the most confusing and least understood part of the home buying process, even for many lenders!
A recent study found that 70% of first time home buyers (and current home owners) in California are not aware that millions of dollars in down payment assistance or closing cost assistance programs go unused each year.
Guess what…37% of the programs DO NOT require you be a first time home buyer!
Did you know, another recent study by RealtyTrac found that 87% of all homes qualify for some sort of homebuyer or down payment assistance program based on the average sales price and buyer’s income?
CALPLUS W/ ZIP EXTRA HOMEBUYER ASSISTANCE PROGRAM
CalPLUS w/ ZIP is CAlHFA’s premiere homebuyer assistance program that provides between 3% to 4.5% in down payment assistance, reduced mortgage insurance premiums. CalPLUS is offered in both FHA and Conventional financing. Eligible buyers cannot exceed the county income limit.
MYHOME ASSISTANCE PROGRAM
The MyHome Assistance programs provides $10,000 or 3% to 3.5% of the sales price or appraised value, whichever is less in down payment and closing cost assistance to first time homebuyers in California. Eligible applicants must meet qualifying requirements for a CalHFA loan program.
GSFA HFA PLATINUM GRANT
Golden State Finance Authority offers 3% to 5% assistance in the form of a non-repayable grant to provide affordable financing to California residents. The GSFA Platinum grant works with Conventional, FHA, and VA home loans and does not require you be a first time buyers. Eligible in all counties in California literally provides a grant to help you purchase a home. Call me to find and compare all of your homebuyer assistance options.
CALHERO DOWN PAYMENT ASSISTANCE
A forgivable grant for down payment assistance. Eligible borrowers are any current, retired, or volunteer Peace/Police Officer, Border Patrol Agent, Correctional Officer, Firefighter, CalFIRE, Paramedic/EMT, Nurse, Teacher, veteran, or Military personnel.
CALIFORNIA FIREFIGHTER DOWN PAYMENT ASSISTANCE (CFDPA)
This Firefighter down payment assistance program provides assistance to first time homebuyers who are employed (not just firefighters) by the federal, state, local, or tribal fire department.
NHF SAPPHIRE GRANT
NHF provides up to 4% grant money for eligible home buyers that never has to be repaid. Available in all counties throughout California, buyers only need a 620 credit score and can DTI ratios can go up to 50%! Borrowers do not have to first time buyers and can even own other properties.
HELP DOWN PAYMENT ASSISTANCE GRANT
Provides 4.5% grant that can be applied towards the down payment or paying closing costs. Eligible in all 58 counties in California and do not have to be first time homebuyers. DTI ratios up to 56%.
1% DOWN CONVENTIONAL EQUITY BOOST GRANT
Down payment assistance program using Conventional financing for buyers with good credit and income. The lender provides a 2% grant and buyer only needs 1% of their own funds. Buyer funds can be gifted from a family member.
HOMEPATH READY BUYER PROGRAM
Fannie Mae closing cost assistance program that gives buyers up to 3% when buying a Fannie Mae owned property.
DREAM MAKERS GRANT
Homebuyer assistance grant that can be applied towards down payment or closing costs. Must be an eligible Veteran, Active Duty, Reserve, or National Guard first time buyer with low to moderate income.
COMMUNITY HOME ADVANTAGE PROGRAM (CHAP)
CHAP provides a reduced interest rate or closing cost credit for homebuyers and homeowners who want to purchase or refinance a home located in an eligible county and zip code of California. There are no income limits.
MORTGAGE CREDIT CERTIFICATE (MCC)
The Mortgage Credit Certificate makes home ownership more affordable for first time home buyers by reducing a buyers federal income tax liability. Paying less taxes means you have more income that can be dedicated to paying your mortgage and can even help you qualify for a larger home loan!
CALHFA SCHOOL TEACHER & EMPLOYEE ASSISTANCE PROGRAM
STEAP provides down payment assistance to eligible teachers, administrators, school district employees, and support staff at K-12 public and charter schools, district offices, and continuation schools.
CITY OF RIVERSIDE DOWN PAYMENT ASSISTANCE
Riverside County Down Payment Assistance is funded by the Economic Development Agency (EDA). They have three programs that offer assistance to home buyers with low to moderate income. While these programs can offer up to 20% down payment assistance, it does require decent credit history and does have more restrictive debt-to-income qualifying ratios that can prevent buyers from qualifying for much higher priced homes….even with the large down payment. These programs also tend to take 60+ days to close escrow so consider that when deciding to use this program.
First Time Home Buyer (FTHB) – Program provides down payment assistance to lower income persons in the form of a silent second mortgage. The second mortgage is forgiven after 15 years. Amount of assistance depends on buyers qualifications and price of the home. Priority is given to section 8 participants. May purchase new or existing homes (doesn’t have to be a foreclosures), and the county will require the review of a home inspection which often requires repairs be made by the seller. Most homes in our market are sold ‘as-is’, and this presents a big problem. And what seller, whether bank owned, a short sale, or regular sale, is looking to accept offers take 60+ days to close escrow and need to possibly make repairs?
Redevelopment Homeownership Program (RHP) – Assistance to first time buyers in unincorporated areas of Riverside County and must be in compliance with Community Development Laws. Assistance amount is for what a buyer needs and qualifies for, in the form a silent second mortgage. Silent second mortgage is forgiven after 45 years. If selling home in the future, home is subject to re-sale restrictions to other low income buyers, which could effect marketability when selling in the future. Refinancing will cause the loan to be repaid in full. Short sale, standard, and bank owned homes qualify for purchase. Again, a home inspection must be submitted to the county for review and repairs made.
Neighborhood Stabilization Homeownership Program (NSHP) – Assistance for FTHB’s to purchase only bank owned/foreclosed homes in targeted areas of Riverside county. Must meet the program income & credit guidelines. The assistance is in the form a second mortgage and becomes forgivable after 15 years. Sell or refinance before that and it must be paid back….ouch! Purchase price must be 1% below appraised home value. A home inspection must be reviewed by the county and repairs are often required. This means seller may need to drop the sales price and make repairs noted on the inspection report. Bank owned/REO foreclosures typically will not accept offers from buyers using this program because they will not make repairs or drop price to satisfy Riverside County. Isn’t that ironic? Using this program can lead to a long drawn out and painful home buying experience.
SAN BERNARDINO COUNTY
San Bernardino Home Ownership Assistance Program is offered by the Dept. of Community Development and Housing. Funds can be used for down payment or closing costs, in the form of a deferred silent second mortgage. It defers at a rate between 10% to 20% (that’s high) and is forgiven after 20 years. If sold, refinanced, or or failure to occupy the home, it will trigger repayment of the loan of the full deferred amount….you cannot rent it out. To qualify, you must have lived or worked in S.B. County1 year prior to application and contribute 3% of your own funds towards buying the home. Not available in Chino, Fontana, Ontario, Redlands, San Bernardino, Upland or Victorville.
San Diego, Orange County, Los Angeles – Call for details on available county specific down payment assistance programs.
HOUSING AUTHORITY OF SAN BERNARDINO HOMEOWNERSHIP ASSISTANCE PROGRAM
Must reside in SB County for 1 year prior to applying, participate at least 1 year in SB housing program, and contribute a total down payment of 3% of the purchase price. The program requires at least 1% of the down payment must come directly from the participant.
SCHFA FIRST HOME GRANT MORTGAGE PROGRAM
Offered by the Southern California Home Financing Authority. The SCHFA First Home grant provides up to 4% for your down payment. Eligible borrowers must be true first time home buyers and purchase in Orange County or Los Angeles County. Borrowers can make up to $128,000 and be eligible.
HOME OWNERSHIP PROGRAM (HOP)
Available on a first come first serve basis. Buyer must contribute 1% of their own funds towards the purchase. $394,000 is the max sales price. Borrowers cannot exceed 80% of the LA County area median income. HOP loans are available in the unincorporated areas of Los Angeles County and cities participating in the Community Development Block Grant (CDBG) Urban County Program. HOP loans provide up to $60,000 for all first-time buyers to assist with down payment and closing costs.
LOW INCOME PURCHASE ASSISTANCE (LIPA)
Up to $60,000 down payment assistance on 1 unit properties for first time homebuyers in the city of Los Angeles only. Assistance funds must be repaid when home is sold and the city takes 20% of your home’s appreciation in value(not good). Buyers must contribute 1% of the sales price from their own funds. Property cannot be occupied by a renter. Property must be inspected by the city, which often asks for many repairs to be made…..many sellers do not like that and will not accept any offer from a buyer using this program.
SANTA ANA HOMEBUYER DOWN PAYMENT ASSISTANCE PROGRAM
Neighborhood Stabilization Program offering up to $40,000 down payment assistance for first time homebuyers in the city of Santa Ana, Orange County. Eligible buyer household income cannot exceed the 80% of the AMI and must contribute 3% of their own funds (cannot be from gift source). Funds are limited.
NEIGHBORHOOD HOUSING SERVICES OF THE INLAND EMPIRE (NHSIE)
Offers down payment assistance to people in Riverside and San Bernardino through these programs.
CalHome – Assistance programs geared towards helping lower income first time home buyers…income cannot exceed 80% of the AMI. Assistance is based off need, which is determined at sole discretion by NHSIE. Assistance amounts equal to 10% of the purchase price/appraisal value or up to $18,000 (whichever is less) in the form of a silent second mortgage, deferred for 30 years at 3%.
NeighborhoodLIFT – Provides $7,500 for down payment assistance that is forgivable after only 5 years of occupying the property as your primary residence. Buyer DO NOT have to be first time home buyers. Funds are limited. Minimum FICO credit score of 640, subject to appraisal and home inspection.
East West Bank REACH – Available in Riverside County, San Bernardino County, and San Diego County. Provides down payment assistance up to 1-2% of the sales price in the form of a forgivable grant. No income limit if buying in a low income census tract must qualify for a HomeReady loan program.
BBVA COMPASS HOME ASSISTANCE PROGRAM
Home Ownership Made Easier program is 100% financing for low income wage earners. BBVA will also provide up to $4,500 in lender credit help pay closing costs. The biggest problem with this program is borrowers cannot exceed 80% of the published HUD AMI limit….which is like $49,700 for a family of 4 in Riverside County. No one making $49,700/year in Riverside County can qualify for a home.
CAR HOMEOWNERS ASSOCIATION GRANT
The California Association of Realtors® Housing Affordability Fund provides qualified first time California homebuyers up to 6 months of HOA dues. Realtors must provide and complete the application for the new homeowner.