California Homebuyer’s Downpayment Assistance Program (CHDAP) Announces changes
the California Homebuyer’s Downpayment Assistance Program (CHDAP) is one of the programs offered by the California Housing Finance Agency (CalHFA) to assist First Time Homebuyers in purchasing a home.
The recent changes to the program will expand the number of qualified applicants by eliminating the minimum borrower contribution and including Loan Prospector as one of the allowed methods of Automated Underwriting.In addition, the limit of $417,000 for the first mortgage has also been removed.
Highlights of the California Homebuyer’s Downpayment Assistance Program (CHDAP):
- Borrower’s must be first time home buyers (can not have had an ownership interest in any principal residence during previous three years)
- Property being financed MUST be a principal residence and must be owner occupied for the term of the loan
- CHDAP can be used for down payment assistance or closing cost cost assistance
- CHDAP loan will be 3% of the sales or appraised value, whichever is less
- CHDAP is a deferred payment junior lien with an interest rate of 3.25%
- Borrower must meet set income limits based on the county property is located in, program being used for the first mortgage and number of persons in the household
- Sales price of the home can not exceed the sales price limit set for the program
- No set minimum contribution by borrower however, the guidelines for the first mortgage must be followed (i.e. FHA requires 3 1/2% down, therefore the borrower would still need to contribute 1/2% to complete the down payment requirements)
- Loan must tbe repaid at the time of sale, transfer of title, payoff or refinance of the first mortgage or upon formal filing and recording of a notice of default
The California Homebuyer’s Downpayment Assistance Program (CHDAP) is an excellent tool that in combination with the right first mortgage and seller contribution can help a First Time Home buyer aquire a property without a large monetary burden.
The list above is not all inclusive of all the features and requirement of this Down Payment Assistance Program, however, it does provide you with some general guidelines.