Looking for a hand getting your foot in the door of the San Diego real estate market?
If you’ve been planning to get into the housing market, you’ve likely already taken a hard look at your budget and been saving for the down payment. Lenders prefer a buyer have 20% to put down before approving a mortgage, but there are programs available for certain income and employment groups to offer buyers a hand taking that first step.
Before going in search of assistance, be sure — in addition to saving — that you’re doing everything possible to clean up your credit score.
The Federal Trade Commission offers a list of tips and resources to make sure you’re taking the proper steps and working with reputable companies. Check out their website for more information.
Now, it’s time to see if you qualify for down payment assistance in the San Diego area.
Here's a quick rundown of our list:
- 1. How to Find the Deals
- 2. Help That Isn’t a Loan
- 3. How it Pays To Serve Your Country
- 4. The Educator Advantage
1. How to Find the Deals
If you’re not a veteran or a school employee, start by checking out the California Homebuyer’s Down Payment Assistance Program, MyHome, DCCA/Cal Home, and Golden State Finance Authority.
The California Homebuyer’s Down Payment Assistance Program is a deferred payment junior loan, which grants buyers up to 3% of the purchase price or appraisal for down payment or closing costs.
The program is limited to first time home buyers who plan to use the home as their primary residence.
Applicants must complete a Home Buyer Education Counseling Course, offered through a number of HUD-approved organizations. The course is eight hours long, and fees vary by agency. Another option is to take the online version, eHome's eight-hour Homebuyer Education course, offered for a fee of $99.
Income limits vary by program. You can find the income eligibility requirements for various programs at FHA.com.
MyHome is a deferred payment junior loan of up to 3.5% of the purchase price or appraised value of the home (whichever is less). It must be combined with a CalHFA first mortgage loan.
It, too, is limited to first time buyers who will use the property as their primary residence. Homes must fall under sales price limits for San Diego county, be on a permanent foundation, and on no more than 5 acres of land. Lenders will have additional requirements.
To find out if your income qualifies for an FHA first mortgage, consult this list updated as of October 2017. If using a Conventional first mortgage, find the income limits here.
The DCCA/Cal Home program offers up to 17% of the purchase price to be used for down payment assistance and requires buyers to pay a minimum of 3% of the purchase price of the home.
Applicants must not have owned a home or been on the title of a home in the last three years. In terms of income limits, the total gross income of the household cannot be more than 80% of
the San Diego County Area Median Income, which you can find here.
The DCCA/Cal Home program is limited to areas in unincorporated San Diego or the cities of Carlsbad, Coronado, Del Mar, Encinitas, Imperial Beach, La Mesa, Lemon Grove, Poway, San Marcos, Santee, Solana Beach or Vista.
Repayment of the loan isn’t required until the buyer refinances, moves, sells the house, or the mortgage is paid off.
2. Help That Isn’t a Loan
The Golden State Finance Authority offers a Platinum Program that is not limited to first time buyers and offers gifts (yes, we said gifts) of up to 5% of the total cost of your loan.
As long as you have a FICO score above 640, your debt-to-income ratio isn’t more than 50%, you intend to use the home as your primary residence, and fall within certain income limits for San Diego County, you could qualify for this program. Income limits are based on mortgage type; the current income limit for FHA, VA, and USDA first mortgages in San Diego county is $91,195 and for Freddie Mac, $117,600.
To find out if you qualify, consult a GSFA Platinum Participating Lender.
Find out more information at their website.
Blog Post Interrupt – The Steps to Get Pre Approved for a Mortgage
Now Back to the Blog Post
3. How it Pays To Serve Your Country
CalVet offers veterans loans with lower-than-market interest rates requiring little or no down payment. Thanks to recently expanded eligibility, almost all veterans qualify for these programs.
You can apply at their website or call a CalVet loan originators at 866-653-2510, Monday through Friday from 9:00 AM to 5:00 PM.
The Navy Federal Credit Union also offers exceptional discounts for qualified applicants, including no down payment options.
4. The Educator Advantage
Do you plan on working in a high priority school or county/continuation school, as a teacher or staff member for the next three years?
First time buyers can benefit from a deferred junior loan of between $7,500-$15,000 if accompanied by a CalHFA first mortgage loan.
Find out more information about the ECTP.
If there’s something here that you still don’t quite understand, contact me and I’ll be able to help you get on the right track.
Leave me a comment below – or, call/text me at (760) 297-4539.
Your DPA Insider,
5 San Diego Down Payment Assistance Secrets Revealed!