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CHF Platinum Grant for California Homebuyers

Screen Shot 2014-04-07 at 12.28.58 AMThe CHF Platinum Grant program was created to increase homeownership opportunities for low to moderate income home buyers in the State of California.

This Grant program provides qualified homebuyers with an opportunity to pay for down payment requirements or closing costs through a special program that is not required to be paid back.

The CHF Platinum Grant is not a second mortgage and does not create a lien against your property.

While this certainly isn’t “free money”, it does come with a little bit higher cost, it is a life save for low to moderate income buyers in need of a little help to realize the American Dream of homeownership.

Mortgage Loan Types and Terms

The CHF Platinum Grant is unique in the sense that in order to use the down payment assistance grant, you must use a specific first mortgage offered by the same lender.

Allowed mortgage programs:

  • FHA 30 Year Fixed Rate Mortgage
  • VA 30 Year Fixed Rate Mortgage
  • USDA 30 Year Fixed Rate Mortgage

Home buyers must qualify under both, the first mortgage guidelines as well as the CHF Grant qualifying guidelines to participate in the program.

Qualifying Guidelines for CHF Grant

As a homebuyer, you need to meet specific qualifying guidelines for the Grant Program that are in addition to the qualifying guidelines of the first mortgage loan.

You must first meet all qualifying guidelines for the FHA, VA or USDA loan being used to finance the purchase of your new home.

You must then meet additional qualifying criteria in order to use the Grant portion of the program.

Homebuyer must meet the following requirements:

  • Must occupy the home as your primary residence – non-occupying co-borrowers are not allowed
  • Income must not exceed CHF income limits for the county in which the home is located.  Income limit is calculated at 115% Area Median Income (AMI).  Click Here for a list of the CHF income limits for all California Counties
  • Minimum credit score is 640
  • Maximum Debt-to-income (DTI) limit is 45%
  • There is no First Time Buyer requirement, however you cannot be on title to any other real property regardless of whether or not you are on the mortgage or where the property is located

Maximum Loan Amount

The lesser of $417,000 or maximum loan amounts allowed by BMCD are permitted for the CHF Platinum Grant program.

Calculating Grant Funds from CHF

The availability and structure of this program are subject to change during the course of this program without notice.  Availability guidelines published here are accurate as of date and time of publication:

  • Available Grant is up to 5% of the First Mortgage Loan Amount
  • CHF Grant may be used for down payment and/or closing costs
  • There must be no cash back to the borrower from the Grant Fund proceeds
  • Lender will request Grant at the time of loan closing

Interest Rates and Closing Costs

Both interest rates and closing costs for the CHF Platinum Grant are set by the lender.  Interest rates are non-negotiable and are unable to be bought down by using discount points.

You may choose the minimum of a 3% Grant at the daily published interest rate, or a 5% Grant at a higher, daily published interest rate.

As of the time and date of the publishing of this article, the interest rates are as follows:

  • 4.5% Interest Rate if using a 3% CHF Grant
  • 5.0% Interest Rate if using a 5% CHF Grant

Please check with your loan officer at a CHF Platinum Grant Program authorized lender to determine current available interest rates when you are ready to purchase your new home using the program.

Using CHF Platinum Grant with CalHFA CHDAP

Using CalHFA CHDAP is allowed along with the CHF Platinum Grant.  It is important to understand that when using these two programs together that you will encounter additional layers of qualifying and processing times.

Buyer assistance for each of these programs are calculated differently as well.

  • CHF Platinum is based on 3% or 5% or the First Mortgage Loan Amount
  • CalHFA CHDAP is based on 3% of the Purchase Price

Each of these program has its own income limits, debt-to-income limits and purchase price limits.

Avoiding Surprises and Frustration

Using buyer assistance programs can be a little tricky.  When you introduce third party programs into a purchase money transaction, you add layers of complication and increase the opportunity for miscommunication and challenges.

Instead of simply qualifying for a purchase money mortgage, you now have to meet additional qualifying guidelines and in many cases, add days or weeks to the amount of time it takes to process and fund all of these programs.

The best way to avoid surprises and frustration is to first and foremost verify that your lender and real estate agent stay in close communication.

Again, adding days or weeks to the purchase timeline means that the seller needs to agree to a longer escrow period.  As long as all parties are informed, this should not present a problem.

Make sure your lender is approved to offer all of the assistance programs you are interested in using.  CalHFA CHDAP and CHF Platinum are only available through approved lenders.

Approved lenders are required to go through special training for each of these programs.  Not all lender will be approved for both programs.  It is not uncommon for lenders to suggest that a program is not available because they are not approved to offer it.

Buyer Assistance Finder

We’ve simplified the process of cross checking availability and eligibility of buyer assistance programs available throughout the State of California.

Simply complete the form below and allow us to run the numbers, check the guidelines, and get back to you with which options might be available to you at this time.

 

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