On a national level, the Federal Housing Administration offers insured loans on a broad basis for disadvantaged families, but CalHFA loans also apply to low-income Californian families who are first-time home buyers. There are a few more requirements to be met, including taking an education course and having not owned and occupied a home for the past three years. It also mandates a 5 percent down payment instead of the FHA’s 3.5 and that the owner continues to live in the property while the loan is active. In exchange, home buyers are given a 30-year fixed-rate loan with interest rates that are typically well below market value.
Some people are hesitant to enter into CalHFA loans due to the mandate on maintaining residence for almost three years, which can be a challenging proposition in a tenuous job market. Whether or not that is manageable is something each individual must consider carefully before applying.
New purchasers in California are often indecisive about which program to pursue. The professionals at Common Sense Mortgage Group, Inc. are able to assess a family’s unique circumstances to determine the best course of action. In some cases, that might mean applying for both and, if both are accepted, comparing offers before accepting one and moving on to closing.