CalHFA Announces New Efforts to Help Low and Moderate Income, First-Time Homebuyers Purchase Homes
SACRAMENTO – The California Housing Finance Agency (CalHFA) announced today a new fixed-rate mortgage program with special opportunities for low and moderate income, first-time homebuyers to receive thousands of dollars in down payment assistance.
The new CalHFA program, called CalPLUS, is an FHA-insured, 30-year fixed mortgage that includes a special zero interest junior loan for as much as 3.5 percent of the first mortgage loan amount to assist borrowers needing funds for a down payment. The Zero Interest Program (ZIP) down payment loan does not have to be repaid until the home is sold, refinanced or paid in full. It is only available as part of the CalPLUS loan.
“Since its inception, CalHFA has focused on helping Californians become homeowners, strengthening communities and neighborhoods,” said Claudia Cappio, Executive Director of CalHFA. “Down payments continue to be one of today’s biggest obstacles for first-time homebuyers. This new program is aimed at bridging that gap for California
A family taking out a $200,000 mortgage, for example, could receive up to $7,000 in down payment assistance through the ZIP benefit of CalPLUS. The CalPLUS can also be combined with other programs, including the California
Homebuyer’s Downpayment Assistance Program (CHDAP), which provides up to three percent of the purchase price or appraised value.
In addition to CalPLUS, CalHFA is also offering a 30-year, FHA-insured mortgage and re-starting its Extra Credit Teacher Program (ECTP). The ECTP offers up to a $15,000 deferred payment, subordinate loan for eligible teachers, administrators, classified employees and staff members working in high priority schools (API ranks 1-5), county
schools or continuation schools throughout the state. Additionally, the ECTP offers a conditional, forgivable interest feature.
Borrowers for these CalHFA programs are required to complete a financial education program. Borrowers must also meet limits on income and sales prices. In Los Angeles County, for example, the income limit for a family of four is $73,600; in Sacramento County, a family of four could earn up to $86,350.
The CalPLUS program can also be combined with a federal program that allows borrowers to offset part of their mortgage interest payments with credits on their federal income taxes. The Mortgage Credit Certificate Tax Credit may enable first-time homebuyers to convert a portion of their annual mortgage interest into a direct dollar-for-dollar tax credit on their U.S. individual income tax returns.