First Time Home Buyer Assistance Program

While the deadline has passed for home buyers that are not already in contract to buy a house, Sacramento County is offering a First Time Home Buyers Assistance program for people who meet income requirements and buy a home in specific areas.

The applicant must be a first-time homebuyer which means the borrower(s) has not owned a home during the last three-years prior to the purchase of a home with CalHome assistance.

This type of assistance requires that the first mortgage lender collect and manage impound accounts for payment of taxes, assessments and hazard insurance. This means you will not get a tax bill, insurance or any other “tax” or association bills to do with the house. You will have just a one monthly payment to take care of all expenses in regards to the loan on your house.

30 Year Loan:

3% fixed rate, simple interest. Principal and interest shall be deferred for the term of the loan. Payable when you sell the house or at the end of 30 years.

“The loan-to-value ratio for the CalHome Program loan, when combined with all other indebtedness to be secured by the property, shall not exceed 100 percent of the sales price plus a maximum of up to five percent of the sales price to cover actual closing costs. ” This means, the total loans on the house, including the first mortgage and the Home Buyer Assistance loan cannot exceed 100% of the purchase price…but you can include up to 5% of the purchase price to cover closing costs (costs associated with doing the loan and title company fees).

Example:

  • Purchase Price of the House = $200,000
  • Closing Costs = $4,000 (Home buyer assistance program loans you this)
  • Down Payment=$6,000 (Home buyer assistance program loans you this)
  • Total Loans on House = $210,000

To get this type of assistance you and your family have to financially qualify. Your total family monthly income cannot exceed 80% of the county median income.

Eligible Income Table

Household Size of the Family 1-person 2-person3-person

4-person

5-person

6-person

80 percent of County median $40,800$46,600$52,450

$58,250

$62,900

$67,550

The maximum purchase price cannot exceed $580,000.

The program is available for homes in Sacramento county. It is not available in Citrus Heights, Elk Grove, Galt, Folsom, Isleton or Rancho Cordova.

This loan is a 30 year, fixed rate at 3%. All payments are deferred. This means you make no payments to this loan. You can if you want, but interest and payments are not due for 30 years. Loans are repayable upon the sale or transfer of the property, when the property ceases to be owner-occupied, or upon the CalHome Program Loan maturity date – 30 years.

Is this free? Almost. How much is almost? Either $50 or $60 is all you have to pay, and that money goes to a state approved homeownership educator program. So you get educated in exchange for your fee. All CalHome homebuyers must attend an 8 hour HUD approved course of homebuyer education classes. These classes offer home buyers information they need to know when buying a home. Home buying and home ownership is much easier if you are educated on what to expect. The homebuyer education requirement may be met by taking the following classes:

Sacramento Home Loan Counseling Center ($60)
  • Course 1 –The Home Buying Process Course
  • Course 2 – Credit & Money Management
  • Course 3 – Home Maintenance/Good Neighbor;   
  • OR

    NeighborWorks Homeownership Center

    Preparing for Homeownership – 8 hour course ($50)

    Is this free? Is it worth $50 or $60 to be able to provide your family with a home that you can call your own? To be able to choose the neighborhood you live in, and to get to use the state’s money for part of the purchase without having to pay it back for 30 years? The government is willing to offer you up to $36,000 to help you purchase your home and defer all payments for 30 years. It is well worth $60 and 8 hours of your time.

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