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First-time homebuyer programs in California

Working with one of CalHFA’s preferred lenders, you’ll be able to apply for mortgage and down payment assistance programs.

To qualify for assistance, you will have to attend an eight-hour homebuyer education course. The online course costs $99, while the fee for in-person options varies by agency. CalHFA is specific about the course you take because they want to ensure you receive one-on-one counselling and follow-up. You’ll be provided with a certificate of completion once you’re done.

In addition to the income limit requirements, you’ll have to show you have good credit, with credit score requirements of at least 660 to 680.

Who qualifies as a first-time homebuyer?

CalHFA defines a first-time homebuyer as someone who has not owned and occupied their own home in the last three years. So if you've never owned a home, you're a first-time homebuyer. But if you owned a home three or more years ago and sold it, you are right back to being a first-time homebuyer again.

Both groups can take advantage of all of the benefits of CalHFA's first-time homebuyer programs.

More: Use these savings accounts to build up your down payment.

MyHome Assistance Program

The MyHome Assistance Program lends money you can use for the down payment and closing costs on your first home. These loans are “silent seconds,” meaning you don’t have to pay them back until your home is sold, refinanced or paid in full.

The loans range from 3% to 3.5% of the home’s purchase price but are capped at $10,000.

You don’t apply directly to CalHFA for MyHome; rather, you work with your loan officer to compile and submit the required documents, which are likely to include pay stubs, bank statements, employment history and previous tax returns.

CalHFA Zero Interest Program

For conventional and FHA mortgages, CalHFA offers a special CalPlus program.

These mortgages will come with a slightly higher 30-year fixed interest rate but are bundled with the Zero Interest Program (ZIP). Through ZIP, you can get a “silent second” loan — with deferred payments and no interest at all — that you can use for your down payment and closing costs.

To qualify for this program, you’ll have to meet the assistance requirements for both credit and income and you must plan to use the property as your primary residence. You can check the specific eligibility requirements of each loan program through the CalHFA website.

Because CalHFA doesn’t directly loan money, you’ll have to apply for ZIP through your loan officer as well.

More: Determine monthly instalments with mortgage income calculator

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Who qualifies for down payment assistance in California?

CalHFA’s programs are also designed to help low- to moderate-income households. On its site, CalHFA has an eligibility calculator where you can find out whether you meet its qualifying criteria.

It’ll take into consideration whether you’ve owned a home in the last three years, your annual income, whether you’re a service member, veteran or spouse of either and in which county you’re hoping to buy.

More: Get a free credit score and credit monitoring from Credit Sesame.

Nationwide first-time homebuyer programs

A “conventional” mortgage sourced from the private market can have demanding requirements, such as a credit score of at least 620 and a minimum down payment of 5%.

That’s easier said than done for many first-time buyers, so you may want to look into one of these nonconventional mortgages offered through the federal government.

FHA loans

FHA loans were launched by the Federal Housing Administration, which is a division of the Department of Housing and Urban Development, to help more Americans become homeowners.

These loans usually have less stringent requirements. You’ll need a minimum credit score of 580 and a 3.5% down payment, but if you’re able to put down more upfront, you could be eligible with a credit score as low as 500.

The FHA's Loan Requirements Explained.

A walkthrough of how to meet the FHA's requirements.

See Guide

VA loans

These loans were created through an act passed by Congress in 1944 to help veterans secure homes. As a result, the U.S. Department of Veterans Affairs (VA) can guarantee or insure home loans made to veterans by various lending institutions.

Active service members, veterans and some surviving military spouses can all qualify for a VA loan. There are fees associated — notably a sizable funding fee — but they are also exempt from down payment and mortgage insurance obligations.

USDA loans

These loans are for lower-income rural and suburban Americans and are guaranteed by the United States Department of Agriculture (USDA). Like VA loans, USDA loans don’t require a down payment or private mortgage insurance.

That said, with a USDA home loan, you’ll have to pay a few fees: an upfront 1% guarantee fee and an annual 0.35% fee. However, the total cost still amounts to less than the amount you’d pay in mortgage insurance on another type of loan.

These loans aren’t meant for most households: They have a strict income limit. The current income limits in most parts of the U.S. are $86,850 for one- to four-member households and $114,650 for five- to eight-member households, but the thresholds may be higher if you live in a county with a steeper-than-average cost of living. The USDA’s website has the exact figures for each region.

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Next steps

Now you know what programs are out there to help — but where do you even start?

Well, your credit store is crucial if you want to qualify for any of these options. The site Credit Sesame can help you find out your score for free.

CalHFA’s credit requirements are a little higher compared to other states, but don’t despair. There are some great options out there, like Self credit repair, that will help you get the score you need to qualify.

With your score in hand, your next step is to gather the essential documents you need to demonstrate that you’ve got a steady income.

Once you’re all set, it’s time to get pre-approved for a mortgage so you can start house hunting.

First-Time Homebuyer Programs by State
New Mexico
New York
North Carolina
South Dakota


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Sigrid Forberg Associate Editor

Sigrid’s is Moneywise.com's associate editor, and she has also worked as a reporter and staff writer on the Moneywise team.


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