The San Diego CA NHF Sapphire Grant is a financial aid program for the state of California.
The fund assists homebuyers with up to 5 percent of the down payment required to purchase a home.
The program is designed to assist homeownership opportunities for low to moderate income individuals and families in California and it's a Down Payment Assistance (DPA) program.
As a grant, the funds sourced from it do not require repayment.
Here's a quick rundown of our list:
- The Sapphire Product
- What Type of Loan Terms are Eligible for the Sapphire Grant?
- Does My Credit Score Matter?
- Do I Need to be a First-Time Homebuyer?
- What Types of Home Assistance Loans can I Use the Sapphire Grant With?
- Can the Sapphire Grant be Used with Other Assistant Programs?
- How Much Money can I get with the Sapphire Grant?
- What can I Use the Sapphire Grant for?
- What Types of Homes are Eligible for the Sapphire Grant?
- What Types of Homes are Ineligible for the Sapphire Grant?
- Can I Use the Sapphire Grant with the 203k FHA Loan?
- Do I Have to be a U.S. Citizen to be Eligible for the Sapphire Grant?
- Can I Have a Co-Borrower on the Loan?
- Is there a Maximum Loan Amount to be Eligible for the Sapphire Grant?
- Are There Income Limits to be Eligible for the Sapphire Grant?
- What is the Income Based On?
- Are there Special Sees and Costs Involved?
The Sapphire Product
In order for somebody to be eligible for the San Diego NHF Sapphire Grant, certain requirements must be met.
Here are the details about the program.
What Type of Loan Terms are Eligible for the Sapphire Grant?
The loan must be a 30-year fixed term with full amortization.
FHA : 203(b); 203(b)(2); 203(h); 234(c); in accordance with FHA guidelines. Temporary buy-downs permitted, per limits and rules.
VA : in accordance with VA guidelines under 1810 and 181A. Temporary buy-downs permitted, per limits and rules.
USDA-RHS : in accordance with USDA guidelines. 2-1 or 1-1 Temporary buy-downs permitted, per limits and rules.
Does My Credit Score Matter?
Your FICO score has to be at a minimum of 620 FHA, VA and USDA loans.
However, your FICO score has to be at a minimum of 680 if you are purchasing a manufactured home on a permanent foundation.
Anything below that and you will not be approved.
Do I Need to be a First-Time Homebuyer?
You do not need to be a first-time homebuyer.
Even if you own other property, you remain eligible.
Even though the Sapphire Grant is not restricted to first-time homebuyers, it cannot be used to purchase a second home.
Homebuyer education is not required.
What Types of Home Assistance Loans can I Use the Sapphire Grant With?
As a down payment assistance program, the San Diego NHA Sapphire Grant may be used in conjunction with any loan from the Federal Housing Authority (FHA), Veterans Affairs (VA), or a USDA 1st trust deed.
Can the Sapphire Grant be Used with Other Assistant Programs?
This program may be used in conjunction with other auxiliary programs such as those from CalHFA (California Housing Finance Agency) or MCC (Mortgage Credit Certificate).
Combining programs can complicate things because each program has it’s own qualifying criteria and may delay the processing and approval of the loan…but it can be done if the seller is willing to accept the longer escrow that will be needed.
Blog Post Interrupt – 4 Ways to Pay for Closing Costs
How Much Money can I get with the Sapphire Grant?
The grant comes in either the amount of 3 percent or 5 percent, whatever you choose, and is based on the total loan amount, including the MIP (Mortgage Insurance Premium) – not the sales price or the appraised value of the home.
What can I Use the Sapphire Grant for?
The Sapphire Grant can be used for the down payment, closing costs, processing fees or origination fees.
What Types of Homes are Eligible for the Sapphire Grant?
Approved home types for the San Diego Sapphire Grant include SFR’s (Single Family Residence), PUD’s (Planned Unit Development), FHA-approved condominiums, and manufactured homes on permanent foundations.
Homes that are purchased using the San Diego NHF Sapphire Grant are allowed to be flipped by the homeowners – provided that the home is owner-occupied during the renovations.
In other words, you may use the NHF Sapphire Grant to purchase a home, invest in the property, and then sell it for a profit.
What Types of Homes are Ineligible for the Sapphire Grant?
You may not use the Sapphire Grant to purchase a co-op, a second home, an investment property that is not owner-occupied, or multifamily homes.
Can I Use the Sapphire Grant with the 203k FHA Loan?
The NHF Sapphire Grant is ineligible to be used in conjunction with the 203k FHA loan.
Do I Have to be a U.S. Citizen to be Eligible for the Sapphire Grant?
Eligible borrowers include natural persons with a valid Social Security number and one of the following Residency statuses as determined by the United States Citizenship and Immigration Services (USCIS):
Permanent Resident Alien
Non-Permanent Resident Alien
Can I Have a Co-Borrower on the Loan?
A co-borrower is permitted so long as the co-borrower will be one of the occupants of the home.
Non-occupant co-borrowers are not allowed.
In other words, everyone on the loan that the Sapphire Grant is assisting with must occupy the home.
Is there a Maximum Loan Amount to be Eligible for the Sapphire Grant?
Yes – the maximum amount of the loan must not be larger than $417,000, not including the MIP (Mortgage Insurance Premiums), or the maximum loan amounts permitted by the HUD (Housing and Urban Development), whichever is less.
In other words, the maximum loan amount eligible for the Sapphire Grant is $417,000.
However, if the maximum loan amount permitted by the Housing and Urban Development is less than that, then the $417,000 figure does not apply.
Instead, the figure from the Housing and Urban Development applies.
Are There Income Limits to be Eligible for the Sapphire Grant?
Yes. If the loan is financed by the FHA, VA or the USDA, the borrower income may not exceed the NHF limits of 115 percent of the AMI (Area Median Income) for the county in which the property is located.
What is the Income Based On?
Income is based on a qualifying income, not household income.
Are there Special Sees and Costs Involved?
Yes. Here are the rules surrounding special fees and costs involved with the San Diego NHF Sapphire Grant.
Origination fees up to 1.50 percent are allowed.
Customary closing costs are allowed.
There may be a grant fee imposed by the lender. This amount may range from $300-$1000 or more.
If an extension is requested, a minimum fee of 0.375 percent of the total loan amount may be assessed. This figure may be higher depending on the lender.
If the loan is canceled, a minimum $400 flat fee may be assessed. This figure may be higher depending on the lender.
The borrower must meet all FHA, VA or USDA-RHS underwriting requirements for the loan.
There must be no cash back to the borrower from the grant fund proceeds.
The lender may charge customary and reasonable closing costs and fees with full disclosure in accordance with FHA, VA, USDA and federal, state and local laws and regulations.
What do you think?
Is getting up to 5% in COMPLETELY FREE grant money to help cover your down payment and closing costs something you're interested in?
Leave a comment below - or, call or text me at (760) 297-4539.
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