As a first-time home buyer, things can get really tricky for you, especially with the finances. Buying a home in South Bay, LA is a daunting task, whether you are buying one for the first time or for the hundredth time. You have to cut down the budget heavily to buy the house of your dreams.
Luckily, the government realizes this burden. Residents of South Bay who are looking to buy a Home can avail different types of loan mortgage programs so that they may avoid breaking the bank. The California Housing Finance Agency which is more commonly known as the CalHFA facilitates home buyers in the Golden State with four main mortgage assistance programs. These programs include:
This subordinate loan is for the middle class and lower-middle-class income group seeking to buy a home for the first time in California. It is a deferred payment that is generally used to either make a down payment or pay the closing costs.
Subordinate means that you do not have to pay back the loan until you sell the house refinance it or its mortgage is paid off. These loans cover the lower of the home’s appraised value or 3.5% of its purchase price. A good option for qualified borrowers is to combine their down payment assistance loans and grant programs with this program.
You can use this program to bring down the closing costs of the CalPLUS Conventional and CalPLUS FHA loans. You can get a zero-interest loan on 4% of the total loan amount in this program. You can have the payments deferred as long as you keep living in the house. However, it has to be paid back in full in case you are selling the house, refinancing it, transferring the title or default on the loan.
It is very much like the My Home Assistance Program as it is also a subordinate loan which has deferred payments. Its purpose is also to pay for closing costs and down payments. The only difference it has is that it can only be used by teachers, staff members, and school employees who work at K-12 public schools in California.
Energy Efficient Mortgage is an FHA-insured program for both first time and repeats home buyers. It is to be paid back in 30 years with a fixed interest charge. Qualified borrowers can get in the form of a grant 4% of the total loan amount if they make energy efficient improvements to their homes more than the allowed amount.