September 23rd, 2008 – In a shocking move today CalHFA temporarily suspends most of thier first time home buyer programs leaving only the 30 year fixed and the Extra Credit Teacher Program:
Effective immediately and until the financial markets stabilize, the following CalHFA first
mortgage products are temporarily unavailable:
• 35-Year Fixed Rate Mortgage – interest only PLUSSM
• 40-Year Fixed Rate Mortgage
• HomeChoice Program
• New BLOCK Forward Commitments will not be issued, including forward commitments
for the Self-Help Builder Assistance Program (SHBAP)
Additionally the following subordinate loan programs are also temporarily unavailable:
• High Cost Area Home Purchase Assistance Program (HiCAP)
• CalHFA Housing Assistance Program (CHAP)
Effective September 23, 2008, the interest rate on all 30-Year Fixed Mortgages will be 6.750%.
This situation is being monitored daily and these rates and loan products are under continual
review. When conditions warrant, programs will be reinstated, announced by Program Bulletin
and posted on CalHFA’s website.
The attached interest rates are applicable to all loan reservations received by the Agency after
12:01 a.m. on September 23, 2008.
We fully expect that this is an extremely temporary move by CalHFA until the Federal Bail out plan is figured out. CalHFA was recently funded and has no shortage of funds to lend as the program has recently recieved it new funding in August of this year.
The anticipation of the federal bail out is sweeping and has the potential to change how all mortgages are written in the future. It is a little scary that CalHFA seems that there is little confidence in the federal government to get this resolved quickly and in a way that protects would protect thier current menu of first time home buyer products and down payment assistance programs.
If you have questions about this or any other down payment assistance programs that may be available in your area call us at 1-866-667-6724 .
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