REAL ESTATE NEWS (Los Angeles, CA) — The California Dream For All Program is designed to help first-time homebuyers in California by providing down payment assistance through the Dream For All Shared Appreciation Loan. This loan is used in conjunction with the Dream For All Conventional first mortgage to cover down payment and/or closing costs.
UPDATE April 8, 2021: PROGRAM HAS BEEN PAUSED DUE TO OVERWHELMING DEMAND — FUNDS MAY ALREADY BE DEPLETED (but don’t get discouraged; program may resume again at any time.)
Benefits of the program include:
Down payment assistance: The program provides a loan for up to 20% of the home purchase price, making it easier for first-time homebuyers to afford a home.
Shared appreciation: Upon the sale or transfer of the home, the homeowner repays the original down payment loan along with a share of the appreciation in the value of the home. This allows the program to recycle funds and continue assisting future homebuyers.
Homebuyer education and counseling: CalHFA requires first-time homebuyers to complete two levels of homebuyer education counseling and obtain a certificate of completion from an eligible organization. This helps ensure the success and happiness of homeowners by providing them with essential knowledge about the home-buying process.
Property eligibility: The program covers single-family, one-unit residences, including approved condominiums/PUDs, guest houses, granny units, in-law quarters, and manufactured housing.
Interest rates: Interest rates for the program will vary depending on the borrower’s financial circumstances, lender fees, and other factors. CalHFA-approved loan officers can provide accurate rate quotes for the program.
To be eligible for the Dream For All Shared Appreciation Loan Program, borrowers must meet specific requirements, including being a first-time homebuyer, occupying the property as a primary residence, and meeting CalHFA income limits. The property must also meet certain requirements, such as being a single-family, one-unit residence.
Homebuyers interested in applying for the program should contact a CalHFA-approved loan officer in their area to learn more about the program and navigate the home buying process. When contacting a loan officer, it is helpful to have documents and information such as pay stubs, bank statements, employment history, and previous tax returns readily available.
The Dream For All Shared Appreciation Loan is a down payment assistance program for first-time homebuyers to be used in conjunction with the Dream For All Conventional first mortgage for down payment and/or closing costs.
Upon sale or transfer of the home, the homebuyer repays the original down payment loan, plus a share of the appreciation in the value of the home.
CalHFA Dream For All Shared Appreciation Loan
Program Eligibility
Review the guidelines below for both Borrower and Property Requirements to determine if you may be eligible to apply for the Dream For All Shared Appreciation Loan Program.
Borrower Requirements
Be a first-time homebuyer. See the definition of a first-time homebuyer.
Occupy the property as a primary residence; non-occupant co-borrowers are not allowed.
CalHFA borrowers must complete two levels of homebuyer education counseling and obtain a certificate of completion through an eligible homebuyer counseling organization.
Meet CalHFA income limits for this program.
*In the case of conflicting guidelines, the lender must follow the more restrictive.
Property Requirements
Be a single-family, one-unit residence, including approved condominium/PUDs
Guest houses, granny units and in-law quarters may be eligible
Manufactured housing is permitted
Condominiums must meet the guidelines of the first mortgage*
*In the case of conflicting guidelines, the lender must follow the more restrictive.
CalHFA Dream For All Shared Appreciation Loan
Shared Appreciation
Shared Appreciation is a little more complex than a typical mortgage loan, so we’ve put together a few examples for you.
Shared Appreciation Examples
Example 1
Example #1: Borrower is a moderate income homebuyer Image Borrower is a CalHFA income homebuyer
Dream For All provides a loan for 20% of the home purchase price.
The homeowner pays back the original loan amount plus 20% of any appreciation in the value of the home.
Example 2
Example #2: Borrower income less than or equal to 80% AMI using the HomeReady Lookup Tool Image Borrower income less than or equal to 80% AMI using the HomeReady Lookup Tool
Reduced (0.75:1) program appreciation share
Program appreciation share is equal to 0.75 times the Shared Appreciation Loan Amount (i.e., the original principal amount) as a percentage of the home value
Dream For All provides a loan for 20% of the home purchase price.
The homeowner pays back the original loan amount plus 15% of any appreciation in the value of the home
CalHFA Dream For All Shared Appreciation Loan
Interest Rate
What is the interest rate?
Interest rates will vary depending on your financial circumstances, lender fees, and other factors. Interest rates can also change daily. We recommend that you check with a CalHFA-approved loan officer to receive an accurate rate quote for this program.
CalHFA does not lend money directly to consumers. CalHFA works through and uses approved lenders to qualify consumers and to make all mortgage loans. The fees you pay could be different depending on the lender and the program. View sample Annual Percentage Rates (APRs) here.
CalHFA Dream For All Shared Appreciation Loan
Homebuyer Education Requirement
CalHFA firmly believes that homebuyer education and counseling is critical to the success and happiness of a homeowner, and requires homebuyer education and counseling for first-time homebuyers using a CalHFA program.
Who has to take this Homebuyer Education and Counseling course?
Only one occupying first-time borrower on each loan transaction.
How do I take this education and counseling course?
ONLINE: eHome’s eight-hour Homebuyer Education and Counseling course is the only online course accepted by CalHFA. (fee: $99) Other online courses like Frameworks and HomeView are not acceptable because they do not provide a one-hour, 1-on-1 counseling follow-up session.
IN-PERSON or VIRTUAL: Live Homebuyer Education and Counseling in-person or virtually though NeighborWorks America or any HUD-Approved Housing Counseling Agency
(fee: varies by agency)
How do I take the additional California Dream For All education?
ONLINE: This education is free and online only. Visit calhfadreamforall.com to get signed up and take the course.
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CalHFA Dream For All Shared Appreciation Loan
How To Apply
How do I apply for this loan program?
Since CalHFA is not a direct lender, our mortgage products are offered through private loan officers who have been approved & trained by our Agency. These loan officers can help you find out more about CalHFA’s programs and guide you through the home buying process.
Visit the Find a Loan Officer link, to contact a loan officer in your area.
What documents should I have ready when contacting a loan officer?
When initially contacting a loan officer, you may want to have this list of documents and information available to help answer questions that they will ask you:
Pay stubs
Bank statements
Employment history
Previous tax returns
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Copyright © This free information provided courtesy L.A. Loft Blog with information provided by Corey Chambers, Broker CalDRE 01889449. We are not associated with the seller, homeowner’s association or developer. For more information, contact 213-880-9910 or visit LALoftBlog.com Licensed in California. All information provided is deemed reliable but is not guaranteed and should be independently verified. Properties subject to prior sale or rental. This is not a solicitation if buyer or seller is already under contract with another broker.