New Income Limits and guidelines for CA Downpayment Assistance Program

New Income Limits and guidelines for CA Downpayment Assistance Program

The California Homebuyer’s Downpayment Assistance program (CHDAP) is a 2nd lien loan with deferred payments and simple interest.  The program is intended to assist low to moderate income first time homebuyers in California with a loan that can be used for down payment and/or closing costs.  The loan is for up to 3% of the sales price or appraised value, whichever is less.

Recently, the California Housing Finance Agency (CalHFA) released two bulletins updating the income limits and updating certain qualifying requirements

The California Homebuyer’s Downpayment Assistance program (CHDAP) is most often used with FHA financing but it is available for those obtaining conventional, USDA and VA loans.

Though CHDAP is thought of as a program for someone with very low income, the local income limits make it a great tool for those that may not normally consider themselves low income. 

CHDAP 2013 Income Limits



So let’s say you have a family of 4 in San Diego County with income of $87,000/year and a car payment of $500. That means that they could conservatively qualify for a total housing payment of .$2900 a month. Keeping in mind the every changing interest rate market, that would be a sales price of approximately $400,000. 

So is that a reasonable sales price for San Diego County? Yes!  There are several San Diego Neighborhoods with median sales prices below $400,000  According to Zillow, the median sales price of several neighborhoods is below the $400,000 threshold.

In addition to the new income limits, guidelines were updated for the California Homebuyers Downpayment Assistance Program (CHDAP).  The most important change is that credit scores have been lowered to 640 for all CHDAP loans except when it is being used with conventional financing with less than 5% down.

CHDAP and other Down Payment Assistance programs should be utilized whenever possible to assist even those that would not normally be thought of as low income.

Contact me to find out more information about this or any other Down Payment Assistance programs.


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