Posts Tagged ‘CHDAP’

1% Down??? Yes – DAP is Back!

Wednesday, September 15th, 2010

The down payment challenge in today’s market for first-time homebuyers isn’t new. It takes time to save 3.5% of the purchase price of a home for the down payment, and in some cases, even more is needed to be saved for the closing costs if the seller isn’t ready or willing to assist. Now, thanks to CalHFA, a new program is available just in time for the fall selling season! This will help both buyers and hard hit new home sales communities, where buyers can find some of the best buys.

The CalHFA FHA 30-year fixed rate government insured loan program, requires that you have not owned a home for the past 3 years, and has income restrictions based on your household size. The income limitations are based on the HUD median income for moderate income households and varies per county. Their are also sales price limits which also vary county by county, and the program is available throughout all of California. Example: Sacramento and Placer sales price limits are $522,000.

This program differs from previous CalHFA programs, in that with partnering with FHA and the CHDAP 2nd, buyers only need to have 1% of their own money available for the down payment. This makes a substantial difference. Example; $300,000 sales price… 3.5%= $10,500 1% = $3,000.

You’ll want to allow a little longer escrow time, as the loans will need to go to CalHFA for final underwriting. This will not be your quick close transaction, however, with a little patience you can benefit from some very attractive interest rates and the low down payment benefit. Additionally, a HUD or Fannie Mae Homeownership Education Class will be required. The classes vary in cost, averaging around $50.00.

The CalHFA loan program is a great option for those buyers that felt “let down” when the government homebuyer tax credits expired. With this new program you have a new window of opportunity, let’s make the best of it. Happy house hunting!

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Ingrid Pierson
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