This post will help you find all the details on 3% down payment assistance program (CHDAP) for San Jose and rest of the Bay Area First Time Home Buyers. I have earlier blogged about CalHFA 5% downpayment program & $8000 First Time Home Buyer Credit in my earlier posts.

The California Homebuyers Downpayment Assistance Program (CHDAP) is a deferred payment, simple interest rate junior loan not to exceed 3% of the sales price or appraised value, whichever is less. The junior loan may be combined with a CalHFA first mortgage loan that is available for only 5% downpayment.

CHDAP may be used as additional down payment or to pay closing costs as allowed by CalHFA, the Lender and the mortgage insurer/guarantor.

Borrower Eligibiltyy – You must meet the following requirements to qualify for this Down Payment Assistance :

• Be a first-time homebuyer
• Occupy the property as your primary residence
• Your income cannot exceed HCD-defined moderate income limits established for the county in which the borrower is purchasing
• Meet credit, income and loan requirements of the CalHFA Conventional Loan Underwriting Guidelines.

Property Eligibilty – Properties must meet the following requirements :

• Sales price of the home cannot exceed CalHFA sales price limits established for the county in which the property is located
• Be a single-family, one-unit residence, including condominium /PUD

Repayment of Junior Loan – Repayment of the principal and interest on the junior loan shall be due and payable at the earlier of the following events:

• Transfer of title
• Sale of the residence
• Payoff or refinance of the first loan
• Upon the formal filing and recording of a Notice of Default (unless rescinded)

Note that as a First Time HomeBuyer even if you use CalHFA & CHDAP, you may still be eligible for the $8000 federal First Time HomeBuyer credit. If you would like to know more about these programs, please contact me.