CalHFA - Below market rates to First-Time home buyers.

CalHFA recently announced a new 30-year mortgage, insured by the Federal Housing Administration. According to CalHFA, this is the CalHFA’s flagship mortgage loan product to get them back in business,
and being offered to first-time homebuyers. In addition, CalHFA has made some improvements to the California Home buyer’s Down payment Assistance Program (CHDAP) that makes it even more attractive. Menifee's housing market has been hit very hard and this new program will help create some new home sales in the area.

The CalHFA FHA mortgage is, at first look, simple enough: a 30-year loan with a fixed rate. It stands out for
two reasons, though. One, it carries a below market interest rate, the result of ongoing bond negotiations  between CalHFA and the US Treasury. Two, when combined with CalHFA’s CHDAP or AHPP (Affordable Housing Partnership Plan) programs, the rate may drop even lower, currently giving a 0.125% break for CHDAP and 0.25% break for AHPP.

They have also made some changes to the underwriting and  documentation requirements for CHDAP, so its standards conform to the standards of the first mortgage.  CHDAP now only requires a 1% buyer contribution instead of the previous 3%.

In addition, the School Facility Fee Down Payment Assistance Program has returned. This program gives a conditional grant to purchasers of newly constructed homes in California, to be used for down payment, closing costs, upgrades, or any other aspect of the purchase. The grant averages about $5,000, and if the qualified buyer stays in the property for three years, it does not need to be repaid.

CalHFA continues to be dedicated to safe, responsible lending. A FHA loan requires a 620 credit score, and every borrower must undergo home buyer counseling.

This FHA loan product, along with their down payment programs, represents a new beginning for CalHFA as they move forward after the extremely challenging events of the past few years. With powerful products like these, CalHFA is poised to open doors for new home buyers, and fund possibilities for the future once again.

Many lenders in Menifee and the Temecula Valley are able to offer this loan. Make sure the broker offering the loan charges reasonable "points". Usually 1 to 2 points is more than enough.

Skylar Lewis
Temecula Real Estate
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