Are you planning on moving to the Golden State? While people often assume that all of the real estate in Sacramento is unaffordable, that’s quite the contrary. There are plenty of options in Sacramento that are affordable and can fit into many budgets.
In addition, there are first-time home buyer assistance programs to help California residents invest in the real estate market. Now, you might be wondering who is considered a first-time buyer in the state of CA, and it’s simple: anyone who hasn’t owned or boughten a home in the last three years.
Transitioning from renting to owning doesn’t have to feel intimidating with help like primary mortgages, grants for the closing costs, and down payment loans. Here’s everything you need to know about purchasing a house in Sacramento, California.
First Time Home Buyer Tax Credit & Down Payment Assistance in California
Check out these two loan options in California that are available to any city, including Sacramento, to help with your down payment or closing cost.
Forgivable Equity Builder Loan
Everyone loves the word forgivable when you’re talking about a loan. The state of California has created a program called the Forgivable Equity Builder loan, which allows people who are first-time home-buyers to receive a loan up to 10% of the price at zero percent interest for their down payment. If you stay in the house for a minimum of five years and it’s your primary residence, your loan gets forgiven. Here are some of the requirements to be eligible for this program:
- First-time home buyer
- Primary resident
- Complete a certification called: the “Homebuyer Education and Counseling course”
- Meet Fannie Mae’s income limits
This loan is only eligible for a single-family residence, an approved condo, or manufactured housing. When you meet with a certified loan officer, bring your bank statements, pay stubs, information about your employment history, and the last five years of tax returns.
MyHome Assistance Program
The MyHome Assistance Program gets utilized with one of the CalHFA loans. The main difference between the Forgivable Equity Builder Loan and this one is that you need to pay it back.
- First-time home-buyer
- Take the “Homebuyer Education and Counseling course”
- Meet the income limits for this program set by CalHFA
- Live in the residents full-time
The approved property types are the same for the forgivable loan: single-family, approved condos, and manufactured homes.
First Time Home Buyer Loans In California
When it comes to first-time buyer mortgage loans, here are some of the most common options for those in the state of California, so since you’re buying in Sacramento keep reading.
USDA Loans | Rural Development Mortgage Loans
A USDA loan focuses on providing home loans to those in rural agriculture. If you’re unsure if the property you’re considering falls under the geographical requirements, the website has an interactive map where you can input the address. While the location is part of the requirements, you can qualify based on your income. There is a single-family housing direct and a single-family guaranteed loan program.
The direct help families who make low income each month afford clean and safe housing.
Then the guarantee focuses more on individuals with moderate income each month.
Depending on the loan you qualify for will determine if you speak with a direct or a guarantee loan officer, but to start, you can contact Deborah.
Contact Information:
- Contact Person: Deborah Jackson
- Title: Guaranteed Loan Director
- Phone Number: (202) 720-1500
FHA Loans | Accepted Credit Scores Starting at 580
As part of the U.S Department of Housing and Urban Development, FHA is a government-backed mortgage loan that allows you the flexibility you need. Regardless if you have a bad credit score or have a higher debt-to-income ratio, you could still qualify for the loan. In addition to the flexibility, based on your credit score, you could end up putting down less than 20%.
Now, onto the requirements:
- Your debt-to-income ratio (DTI) needs to be less than 43%
- The home must be your primary residency
- Steady income and proof that you’re employed
- Able to purchase a Mortgage Insurance Premium (MIP)
This loan is an incredible opportunity for the first-time home buyer in California, especially if you’re trying to save for a down payment.
Contact Information:
- Phone Number: (800) 225-5342
- Email Address: [email protected]
CalHFA | USDA Guaranteed Program
The USDA loan branch is the parent company of the CalHFA program. While you still need to be in the eligible rural areas, this loan requires each homeowner to go through an educational course that goes over everything you need to know regarding the home buying system. But what makes this option stand out is your ability to apply for down payment assistance.
Contact Information:
- Phone Number: (877) 922-5432
CalVet | Veteran Mortgage Loan
CalVet is a program that helps veterans purchase a home. A down payment is not required, and nearly every single veteran within the state of California qualifies for this loan. Here is a breakdown of the eligibility requirements that the state of California has set for this veterans program:
- Served on active duty for at least 90 days (this does not include training programs)
- Honorable service
If you have previously used your benefits, you can utilize them a second time as long as you don’t have an open CalVet loan. And a recent change to the requirements, you are not required to have prior residency to qualify.
Contact Information:
- Address: 1227 O Street, Sacramento, CA 95814
- Phone Number: (866) 653-2510
- Hours of Operations: Monday through Friday from 8:00am till 5:00pm
First Time Home Buyer Programs in Sacramento County
Are you looking for mortgage loans that are specific to Sacramento, CA? Here’s what you need to know!
Permanent Local Housing Allocation (PLHA)
The PLHA provides first-time home buyers the flexibility they need to get their foot in the door of the world of real estate. Most of the time, this program gets combined with an FHA, conventional, or CalHFA loan. It allows you to borrow up to 20% of the price of the home or a maximum of $50,000 which is commonly used to help with the down payment.
And there is a 1% simple interest for the duration of your mortgage loan. For you to be eligible, your residence must be in Sacramento, and your income can’t be over the limit.
Contact Information:
- Address: 2020 W El Camino Ave. Sacramento, CA
CalHome First-Time Homebuyer Mortgage Assistance Program
The CalHFA program has the exact requirements as the PLHA, but the main difference will be that you can borrow up to 20% of the price of the home or a maximum of $40,000. Plus, you will have 3% simple interest instead of 1%. This program is commonly used to help with the down payment.
Contact Information:
- Phone Number: (916) 440-1393
Welcome Home Program
The city of Sacramento has created a program called Welcome Home, and the goal is to help residents become homeowners by purchasing homes from the city’s Housing Authorities. When it comes to eligibility, you must meet the income limits set by the program. Here is a breakdown according to the website:
When it comes to the price these homes are getting sold for, it will be based on one of these two things:
- The low end of the appraised value of the home
- A preset sales price that is affordable for the income limits stated above
California First time Home Buyer FAQs
- California first-time home buyer programs are worth it because they can help you get your foot in the door, along with down payment assistance and even low-interest loans.
- To qualify for a mortgage down payment assistance in California, you can’t go over the designated income limit (different for each program), have the home be your primary residence, complete a course, and be a first-time home buyer.
- California has USDA, FHA, CalHFA, and CalVet mortgage loans available throughout the entire state.
The state of California is on a mission to provide affordable housing options to those who want to purchase a home. There are plenty of programs to help you with your down payment or first-time buyer loan. And when the time comes, Mother Lode Moving is here to help provide the best relocation service. Call us today at (961) 631-4285 to learn more about our company and grade-a moving services!
