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CalHFA FHA Lowers Interest Rates August 2011

CalHFA FHA Rates DropCalHFA FHA has lowered it’s interest rates .5% last week, which once again puts this program on my radar as a viable and awesome option.

A while back, I wrote a post about how I had lost favor with this program because it was priced out of the market.

With interest rates continue to inch toward historic lows, once again, there are many great options surfacing for home buyers and home owners looking to reduce their interest rate.

CalHFA interest rates do not change very often as is the case with “market” rates.  When they do change, however, they usually postion the rates so that they will be competitive for some time.

CalHFA FHA & CHDAP

The California Housing Finance Agency (aka-CalHFA) is the official State of California first time homebuyer program.

The great thing about this program is that they actually offer incentives for buyers that use the CHDAP down payment assistance program.

The interest rate improves by 1/8% when used in conjunction with the CalHFA FHA first mortgage.

CalHFA FHA Good, Bad and the Ugly

The Good:  This is a great opportunity for low to moderate income families that need a little extra help qualifying for a home purchase loan.

The Bad: Not everyone qualifies for this program.  There are income limits and purchase price limits that must complied with.  The income limits for CHDAP are different from the CalHFA FHA so check both links.

You also have to be a first time homebuyer to qualify.

The Ugly: Recapture could be ugly.  Recapture means that if you sell or refinance the home within 9 years, there could be a federal recapture tax.  I personally have never seen the recapture trigger, but it’s a good idea that you understand the risk.

This is a really good time for home buyers.  Interest rates are low.  Homes affordability is at an all time high.

If the CalHFA FHA does not seem like it’s exactly what you’re looking for, if you are not a first time homebuyer or if you would like to explore other down payment assistance programs – check out the CHF Platinum Homebuyer Grant.

Questions or comments?  Ask your question below – I answer ALL questions 🙂

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10 Responses to CalHFA FHA Lowers Interest Rates August 2011

  1. Sonia December 9, 2011 at 12:38 am #

    I’d like to know if I’m considered a first-time homebuyer. My brother and I own and share a house, which we paid off 2 years ago. Both our names are on the house title, but only my brother claimed property tax deduction on his tax return. I’m looking to buy a house for my self as my primary residence. Some brokers I spoke to said that since I own a house with my brother, I’m not qualified as a first-time homebuyer. Another loan broker said if I didn’t claim home loan interest or property tax deduction on my tax returns in the past 3 years, then I can be considered as a first-time homebuyer. I’m confused. I read some of your responses to other people questions and really like your straightforward answers. Could your please tell me if I’m qualified as a first-time homebuyer as defined by the State of california? Thank you in advance.

    • Legacy Content December 9, 2011 at 10:50 am #

      Hi Sonia,

      The definition of a first time homebuyer for the CalHFA program is that you cannot have ownership in a primary residence in the past 36 months. Being on title makes you an “owner”, regardless of whether or not you took the tax deduction. If you did not live in the home as your primary residence during those years, you WOULD be considered a first time homebuyer. Are you trying to qualify for the CHDAP down payment assistance program? Or are you just looking to qualify for the CalHFA FHA. The reason I ask is that the CalHFA FHA is temporarily suspended.

      If you do not need help with the 3.5% down payment required on a FHA loan, you can still buy. Feel free to give me a call if you have further questions. We are a direct lender in Golden State and specialize in these programs.

      My cell number is (714) 464-2945

  2. Tracy August 16, 2011 at 2:36 pm #

    What do I need to do to apply for the CalHFA FHA program?

    • Legacy Content August 16, 2011 at 2:56 pm #

      Hi Tracy,
      There are a few disclosures and forms required for CalHFA loans which are not typical for other types of financing, but really it’s just like a normal FHA loan as far as qualifying goes.

      I am going to ask a home buying specialist send you an email introducing themselves as well as provide you with a list of what is required to start the process. It doesn’t cost anything and it’s really quite simple to apply, you might be surprised.

  3. Andre August 16, 2011 at 1:22 pm #

    Hi [Broadview], First and foremost, I’d like to appreciate you for what you doing for all homebuyers like me.
    Just a few question on credit rating, is there any programs that with a credit score of less than 600 can get an approval for CHDAF, coz I know Wells Fargo has a program for this kind of credit score but it needs a 10 % down payment, can this DPA can be apply thru CHDAF. Thanks and Regards.

    • Legacy Content August 16, 2011 at 2:07 pm #

      Hi Andre,
      Thank you very much for the kind words, I really appreciate it. I have heard of lenders offering loan programs for credit scores under 640, I just don’t know of any. I encourage you to let us at least take a look at what’s causing your scores to drop. It’s not uncommon for us to help home buyers fix their credit first so that they are able to buy in the future. If you’re interested in looking into this further, complete the down payment assistance finder form, call or live chat on the top right of this article and let’s look into this a little more. What do we have to lose? Nothing!

  4. Lavender August 16, 2011 at 10:04 am #

    I am a first time home buyer. I have been pre-approved for both CALSTRS and CAL platinium. If you were in my situation which loan would you use? The CAL platinium assistance program or CALSTRS?

    • Legacy Content August 16, 2011 at 10:47 am #

      Hi Lavender,
      I don’t know if I could say that one is better than the other, they are different. The CalSTRS 80/17 is much more flexible and will cost less in the long run when you consider that there is no home loan insurance. However, if your credit scores are less than 720, CalSTRS 80/17 will have higher closing costs.

      Your lender should sit down with you and review all of the positives and negatives of each loan (they both have them!). There is no one loan that is “better”, but one may surface as being better for you, and your specific situation.

      Hope this helps? If you have further questions or would like to get a second opinion, feel free to give us a call or live chat on the upper right side of this article

  5. Doyle Warkentin August 16, 2011 at 7:38 am #

    I am a RE Broker with a client that had an appoval for an FHA loan but the home she found requires Homepath Renovation or 203K financing. She tried to get a Renovation loan but the person she tried to deal with bruched her off and tried to roll her over to his friend for 203K. Then they both told her she could not get approved based on what they got from a computer and not from an underwritter. The previous approval was through Chase Bank and they DID go to the underwriters. How can she get the renovation financing? She is a first time home buyer with 700 scores, has an accepted offer with income in excess of $2500 per month and payments of less than $500 per month. Who can she talk to? Thanks, Doyle

    • Legacy Content August 16, 2011 at 9:41 am #

      Hi Doyle,
      Renovation loans seem to be one of those products that you hear about often, but I run into very few positive stories around people actually using them.

      Our company offers HomePath, but not the HomePath Renovation loan. I’ll keep my eyes open for a reputable lender offering this product.

      What State and City are you and your client in? I know a lot of people, I’ll do some research for you! You can shoot me an email with your location directly to [Broadview]S@BroadviewMortgage.com