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DPA PROGRAM IN CALIFORNIA
What type of down payment assistance mortgage programs are available in California.
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4 Replies
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Down payment assistance programs are available all over California to help homebuyers—especially those purchasing their first house. Here are the main ones:
CalHFA MyHome Assistance Program:
Summary: Provides a deferred-payment junior loan for down payment and closing costs.
Eligibility: Should be a first-time homebuyer with income and property qualifications.
Loan Amount: Up to 3.5% of the purchase price or appraised value, whichever is less.
Repayment: Deferred until you sell, refinance, or pay off the first mortgage.
CalHFA Zero Interest Program (ZIP):
Summary: Offers a zero-interest loan for down payment and closing costs.
Eligibility: Must be a first-time homebuyer using CalHFA FHA loans.
Loan Amount: Up to 3% of the first mortgage loan amount.
Repayment: Deferred until the mortgage is paid off, sold, or refinanced.
GSFA Platinum Program
Summary: It gives non-repayable grants that help with down payment and closing cost assistance.
Eligibility: Open to low-to-moderate income individuals; does not exclude first-time homebuyers.
Grant Amount: Can go up as high as 5% of the primary mortgage loan amount.
Repayment: No repayment necessary!
California Homebuyer’s Downpayment Assistance Program (CHDAP)
Summary: Provides deferred-payment junior loan of up to 3% of purchase price or appraised value for down payment purposes only.
Eligibility: Geared towards low- to moderate-income people buying their first house ever!
Loan Amount: As much as 3% of the purchase price can be borrowed through this program alone!
Repayment Plan Options/Requirements: None until property sold; refinanced or paid in full – then due in full w/interest added back retroactive from origination date (OUCH).
City and County Programs
Los Angeles: LIPA (Low Income Purchase Assistance Program) & MIPA (Moderate Income Purchase Assistance Program) offer loans for down payments and closing costs.
San Francisco: DALP (Downpayment Assistance Loan Program) – provides a loan for down payment assistance that must be repaid upon resale or refinancing.
San Diego: SDHC First-Time Homebuyer Program – provides down payment and closing cost assistance loans.
Federal programs
FHA Loans – while not exclusive to California, FHA loans often work hand-in-hand with state/local grants, which require less money upfront than traditional mortgages. Applicants can also get approved more easily if they have poor credit scores due in part to the there is no private mortgage insurance needed on these types of deals either! The only drawback is that it limits how much one can borrow based on one income level, but is it still worth looking into if this affects your situation since every little bit helps when buying a new place, right?
VA Loans:
VA Loans are available for veterans, active service members, and eligible surviving spouses. There are no down payment requirements, and they can be used in conjunction with local assistance programs.
How to Use Down Payment Assistance Programs Strategically:
Research Local Programs: Check city/county housing agencies’ websites or call them directly for information about what’s available where you live/work/play/eat/sleep/etcetera (you get it).
Combine Programs If Possible: Some assistance options can be combined, which may increase the amount of help offered overall; ask lenders or program administrators if this is allowed under certain circumstances, such as low-income households, etc., and so forth… just kidding. I know no other examples at the moment, but maybe somebody else does. Bueller?
Meet Eligibility Requirements: Know what’s required before applying anywhere; otherwise, nobody has time for that!
Work with Knowledgeable Lender(s): Choose wisely by selecting professionals who know their stuff, especially regarding these types of deals that require specialized knowledge not typically possessed by average Joes off the street. Eighty percent of the borrowers at Gustan Cho Associates could not qualify at other mortgage companies.
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Thank you for the quick response on posting the down payment assistance program available in California. However, besides knowing all the available down payment assistance program in California, more importantly, I need the eligibility requirements for all of the down payment assistance mortgage programs in California. What are the eligibility requirements? What is the minimum credit score required? Do you need to be a first-time homebuyer? Can you have bad credit and if so what are the parameters on the type of bad credit you can have? Is the down payment assistance mortgage program forgiveable or does it need to be paid back? Is there a cap on household income? Do you have to take any first-time homebuyer classes? How long does the down payment assistance mortgage program take to qualify and get approved? Thank you in advance.
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This is a comprehensive look at the qualifications for California’s largest down payment assistance programs:
CalHFA MyHome Assistance Program:
Eligibility Standards:
- First-Time Homebuyer: You must be a first-time buyer (meaning you haven’t owned a home in the last three years).
- Minimum Credit Score: 640 for traditional loans, 660 for FHA loans.
- Income Limits: The maximum income allowed depends on the county and the number of people in your household.
- Generally, it can’t exceed what CalHFA sets as the county limit.
- Debt-to-Income Ratio (DTI): The highest DTI ratio that will fly is 45%.
- Property Requirements: Only single-family homes and approved condos/PUDs are accepted — but some manufactured housing works, too.
- Repayment: Payment is deferred until you sell or refinance the house or pay off your mortgage.
- First-Time Homebuyer Classes: You have to take an approved homebuyer education course.
CalHFA Zero Interest Program (ZIP):
Eligibility Standards:
- First-Time Homebuyer: Yes, you must be a first-time buyer.
- Minimum Credit Score: 640.
- Income Limits: Same as CalHFA MyHome but varies by county and household size.
- DTI: Maximum DTI of 45%.
- Property Requirements: Same as CalHFA MyHome.
- Repayment: Deferred payment.
- First-Time Homebuyer Classes Required.
GSFA Platinum Program
- Eligibility Standards: First-time homebuyers are not required.
- Minimum Credit Score: 640 for FHA, VA, and USDA loans. 660 for conventional loans.
- Income Limits: Vary by county and program guidelines.
- DTI: Max DTI of 45%.
- Property Requirements: Must be the primary residence — single-family homes, 2-4 units, condos, and manufactured homes.
- Repayment: As a non-repayable grant.
- First-Time Homebuyer Classes Not required but recommended.
California Homebuyer’s Downpayment Assistance: Program (CHDAP): Eligibility Standards:
- First-Time Homebuyer: Yes, you must be a first-time buyer.
- Minimum Credit Score: 640 FICO.
- Income Limits: Varies by county and household size.
- DTI: Maximum DTI of 45%.
- Property Requirements: Same as CalHFA MyHome.
- Repayment: Deferred payment.
- First-Time Homebuyer Classes Required.
City and County-Specific Programs:
Los Angeles (LIPA and MIPA):
Eligibility Standards:
- First-Time Homebuyer: Yes.
- Minimum Credit Score: Typically 640.
- Income Limits for LIPA: Cannot exceed 80% of the area median income (AMI). They vary for MIPA.
- DTI Ratio: Typically up to 45%.
- Property Requirements: Must be within the city limits and meet property standards.
- Repayment: Deferred payment is due when you sell, refinance, or pay off your mortgage.
- First-Time Homebuyer Classes Required.
San Francisco (DALP):
Eligibility Standards:
- First-Time Homebuyer: Yes.
- Minimum Credit Score: Typically 640.
- Income Limits: Can’t exceed 120% of the AMI.
- DTI Ratio: Typically up to 45%.
- Property Requirements: Must be within the city limits.
- Repayment: Deferred payment is due when you sell, refinance, or pay off your mortgage.
- First-Time Homebuyer Classes Required.
San Diego (SDHC)
- Eligibility Standards: First-Time Homebuyers Only.
- Education for House Buyers: Nearly all call for completing a home-buying course, particularly among those purchasing their first home.
- Time of Consent:
Generally, it takes several weeks to several months to qualify and receive approval for down payment aid; this may vary depending on the program and an applicant’s financial condition.
To learn more about each program in detail or determine specific eligibility requirements, please visit their websites or contact the local housing authority.
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There are multiple down payment assistance programs in California. Here is an overview of a few major programs and their typical qualifications:
CalHFA MyHome Assistance Program:
- Who qualifies: Those buying a home for the first time (have not owned a home in the past three years).
- Minimum credit requirement: 660 FICO. Completion of homebuyer education course mandatory.
- Income limits differ by county.
- The property has to be owner-occupied.
- Details: Up to 3.5% of purchase price or appraised value.
- Deferred junior loan.
- Must be used with CalHFA’s first mortgage.
CalHFA Zero Interest Program (ZIP):
- Who qualifies: It is the same as the MyHome program.
- Minimum credit requirement: 660
- Income limits apply.
- Details: 0% rate of interest.
- Up to 3%-4% of the amount lent on the first mortgage loan.
- Must be used with CalHFA’s first mortgage.
Golden State Finance Authority (GSFA) Platinum Program:
- Who qualifies: Not restricted to first-time buyers.
- Minimum credit requirement: 640 FICO.
- Income limits up to 140% of the area’s median income.
- Details: Up to 5% of the loan amount.
- It can be forgiven after three years (20% each year).
California Homebuyer’s Down Payment Assistance Program (CHDAP):
- Who qualifies: First-time buyers only.
- Income limits vary by county.
- Completion of homebuyer education is mandatory.
- Details: Deferred junior loan.
- Up to 3% of purchase price or appraised value.
General points:
Bad credit: Most programs require at least fair credit minimums, meaning over 620 ratings on average. Some might accept lower scores but enforce stricter conditions instead.
Repayment methods: Many involve deferred payments due upon sale/refinance/when the first mortgage is paid off. Others offer partial forgiveness options, too.
Caps on earnings: Usually based on area median income levels (AMI). They vary from one scheme to another.
Homebuyer education: Homebuyer education is usually required under most programs.
Approval time: This can normally take 30-45 days alongside the primary mortgage process, but this may vary considerably.
It’s important to note that program details can change, or additional programs could be available locally. For the most accurate and up-to-date information, it is recommended to consult a housing counselor or lender approved by the California Housing Finance Agency (CalHFA).
Remember that eligibility and terms are often location-specific within California and subject to current funding availability, so always verify what’s current with providers themselves (or their authorized lenders).