A comprehensive guide to California’s MyHome Program, providing up to 3.5% in down payment and closing cost assistance for first-time homebuyers.

If you’re a first-time homebuyer in California, the CalHFA MyHome Down Payment Assistance Program could be the key to helping you get into your dream home. This program offers a deferred-payment loan that covers down payment and closing costs, meaning less money out of your pocket upfront. Buyers may be able to borrow up to 3.5% of the home’s sales price, making homeownership more accessible.

Happy couple standing outside their newly purchased home after receiving CalHFA MyHome 3.5% down payment assistance.
First-time homebuyers celebrate receiving 3.5% down payment assistance through CalHFA’s MyHome Program to purchase their dream home.

How Does the Down Payment Assistance Work?

The down payment assistance (DPA) is structured as a second mortgage with an extremely low 1% interest rate. There are no monthly payments required for this second lien, and it only needs to be repaid when you sell, refinance, or after 30 years if you’ve neither sold nor refinanced your home. This makes the DPA an appealing option for buyers who want to lower their upfront costs without worrying about immediate repayments.

The program also offers assistance for closing costs through what’s called a ZIP Loan. This is a separate loan that covers either 2% or 3% of the total loan amount, but the catch is that the interest rate on your primary mortgage will increase to accommodate the ZIP loan. For example, if your base mortgage rate is 6.375%, adding a 2% ZIP loan raises it to 7.375%, and a 3% ZIP bumps it to 7.875%.

However, the ZIP loan does not accrue interest, and like the DPA, it only needs to be repaid when you sell or refinance the home.

What’s an Example of How This Works?

Let’s say you’re buying a home in California for $750,000 and using the CalHFA MyHome program with a 3% down payment. If you manage to negotiate for the seller to cover closing costs, your down payment would be $22,500. The first mortgage would be for $727,500, and you would have a second lien for the DPA to cover part of this.

With a 30-year fixed mortgage at 6.375%, your monthly mortgage payment would be around $4,539. Factoring in property taxes, private mortgage insurance, and homeowners insurance, your total monthly payment would come to about $5,925. You could reduce your monthly payment if you choose to cover the closing costs yourself or have the seller contribute, but that’s up to your individual financial situation.

Does CalHFA Keep Any of My Home’s Appreciation?

Unlike the California Dream for All program, CalHFA’s MyHome program does not require homeowners to share any appreciation with the state. When you sell your home, any increase in value is yours to keep.

Who is Eligible for the Program?

To qualify for CalHFA’s MyHome program, you need to be a first-time homebuyer, meaning you haven’t owned a home as your primary residence in the past three years. The program also comes with income limits, but they are quite generous. For example, the household income cap is $236,000 for San Diego County, allowing most buyers plenty of room to qualify.

Other requirements include:

  • Purchasing a single-family residence, condo, townhouse, or manufactured home that you will live in as your primary residence.
  • Completing homebuyer education counseling.
  • Meeting minimum credit score requirements (680 for conventional loans, 640 for FHA).
  • Providing income documentation for the past two years.

What Types of Homes Qualify?

The program covers a variety of property types, including single-family homes, condos, townhomes, manufactured homes, and accessory dwelling units (ADUs). However, investment properties and non-occupying co-borrowers do not qualify.

Will This Program Run Out of Money?

Fortunately, the CalHFA MyHome program is self-sustaining, meaning the funds are continually reinvested as more people utilize the program, so there’s no risk of the money running out.

CalHFA’s MyHome Down Payment Assistance Program is a valuable resource for first-time homebuyers looking to reduce their out-of-pocket expenses and get into a home without the stress of immediate loan repayments. With favorable terms and flexible options for down payment and closing cost assistance, it’s a powerful tool to help more people achieve their homeownership goals in California.

For more details or to find out if you qualify, you can visit the CalHFA website or consult with a registered lender who can walk you through the process and help you secure the best terms for your financial situation.

MORE CRITICAL INFORMATION

Program Eligibility for the MyHome Assistance Program

Review the guidelines below for both Borrower and Property Requirements to determine if you may be eligible to apply for the MyHome Assistance Program.

Borrower Requirements

  • Be a first-time homebuyer. See the definition of a first-time homebuyer.
  • Occupy the property as a primary residence; non-occupant co-borrowers are not allowed.
  • CalHFA borrowers must complete homebuyer education counseling and obtain a certificate of completion through an eligible homebuyer counseling organization.
  • Meet CalHFA income limits for this program.

*In the case of conflicting guidelines, the lender must follow the more restrictive.

Property Requirements

  • Be a single-family, one-unit residence, including approved condominium/PUDs
    • Guest houses, granny units and in-law quarters may be eligible
  • Manufactured housing is permitted
  • Condominiums must meet the guidelines of the first mortgage

*In the case of conflicting guidelines, the lender must follow the more restrictive.

Interest Rate for the MyHome Assistance Program

What is the interest rate?
Interest rates will vary depending on your financial circumstances, lender fees, and other factors. Interest rates can also change daily. We recommend that you check with a CalHFA-approved loan officer to receive an accurate rate quote for this program.

CalHFA does not lend money directly to consumers. CalHFA works through and uses approved lenders to qualify consumers and to make all mortgage loans. The fees you pay could be different depending on the lender and the program. View sample Annual Percentage Rates (APRs) here.

Homebuyer Education Requirement the MyHome Assistance Program

CalHFA firmly believes that homebuyer education and counseling is critical to the success and happiness of a homeowner, and requires homebuyer education and counseling for first-time homebuyers using a CalHFA program.

Who has to take this Homebuyer Education and Counseling course?

Only one occupying first-time borrower on each loan transaction.

How do I take this education and counseling course?

How To Apply to MyHome Assistance Program

How do I apply for this loan program?
Since CalHFA is not a direct lender, our mortgage products are offered through private loan officers who have been approved & trained by our Agency. These loan officers can help you find out more about CalHFA’s programs and guide you through the home buying process.

Visit the Find a Loan Officer tab, to contact a loan officer in your area.

What documents should I have ready when contacting a loan officer?
When initially contacting a loan officer, you may want to have this list of documents and information available to help answer questions that they will ask you:

  • Pay stubs
  • Bank statements
  • Employment history
  • Previous tax return

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