CHDAP (California Housing Down payment Assistance Program)- a down payment assistance program for California home buyers   is  a deal that sounds too good to be true. CHDAP  is offering to help with the down payment of your home.

What is CHDAP?

CHDAP is a loan provided by the state of the California to aid first time homebuyers in the purchase of a home. CHDAP provides a home buyer a second mortgage up to 3% of the purchase price that can be used towards the down payment. Currently, the interest rate on the CHDAP loan is 3.25%, and a buyer can borrower up to 3% of the purchase price. These funds can be used towards the down payment and/or closing costs.

How does it Work?

The CHDAP loan is a silent 2nd and unlike a traditional mortgage, does not require a monthly payment. No payments are required on your CHDAP loan until you sell or refinance your home. The CHDAP loan does accrue simple interest until it’s paid off. When using CHDAP you will still need to qualify for a first mortgage since CHDAP only provides a maximum of 3% in assistance. However, using an FHA loan which only requires only 3.5% down, in conjunction with the CHDAP 2nd you can purchase a home with as little as ½%. CHDAP is available in all counties of California, but certain qualifications do apply.

Who is Eligible?

CHDAP is made available to first time homebuyers purchasing their primary residence. (If you have not owned a home in the last 3 years, you are considered a first time homebuyer.) There are exceptions to the first time home buyer requirement, namely if you are a qualified veteran or if you are purchasing a home in a targeted area.

Homebuyers must meet minimum credit and income requirement. A minimum 640 FICO score is required, and a borrower’s income cannot exceed moderate income limits established for each county. In addition, the purchase price of the home cannot exceed the purchase price limits set in each county by CHDAP. (For further information on income and sales price limits, contact your BankerBroker Massey K. 949-244-1880.

The borrower must contribute the greater of $1,000 or 1% of the sales price from their own funds. However, other approved down payment assistance loans or grants in conjunction with CHDAP.

Like many government sponsored assistance programs, the borrower is required to complete homebuyer education counseling and obtain a certificate of completion through an eligible homebuyer counseling organization prior to the funding of the CHDAP loan.

In addition to the above mentioned guidelines/restrictions, CHDAP requires the home be a single family, 1-unit residence. Condominiums are required to meet the guidelines of the first mortgage. Manufactured housing, leaseholds, land trusts and Co-ops are not permitted. There is a five acre maximum on all property sizes.

What is the interest rate on the First Mortgage?

Interest rates will vary depending on your financial circumstances, lender fees, and other factors. Interest rates can also change daily. We recommend that you call us to receive an accurate rate quote for this program.

How do I apply for this loan program?

CalHFA which offers the CHDAP loan is not a direct lender, the CHDAP loan is offered through private loan officers who have been approved & trained by CalHFA. These loan officers can help you find out more about CalHFA’s programs and guide you through the home buying process.

Documents Needed

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

• Two years tax returns

If you would like more information about California down payment assistance program- CHDAP(California Housing Down Payment Assistance Program), please give us a call or apply online today!

949-244-1880 Massey Kouhssari your BankerBroker

BankerBroker.com is proud to announce the avilability of down payment assistance programs for you to purchase your next home in these communities or in the Los Angeles, Orange County, Riverside, San Bernardino and San Diego county.

1. California Housing Finance Agency (CalHFA FHA & CHDAP)

CalHFA FHA

The California Housing Finance Agency offers a below market mortgage option to first time homebuyers.  The CalHFA FHA 30-year Fixed Mortgage provides up to 96.5% financing with a low, fixed interest rate that never changes during the life of the loan.  This first mortgage can be combined with CalHFA’s down payment assistance programs for added benefit.

CHDAP, Down Payment Assistance That Works

CalHFA can also help with your down payment or closing cost.  Payments on these one-of-a-kind loans are deferred, meaning you don’t have to pay them back until you sell, refinance or pay off your home.

California Homebuyer’s Downpayment Assistance Program (CHDAP) – offers up to 3% down payment or closing cost assistance and can be combined with any of CalHFA’s first mortgages.

Get your Grant funds today

2. National Homebuyers Fund – CHF Platinum Grant

The CHF Platinum grant program provides down payment assistance for low-to-moderate income individuals and families purchasing a home. Homebuyers can receive up to 3% of their first mortgage to be used as a down payment and/or closing costs.

• Primary residence, owner occupied
• Does not have to be a first-time homebuyer
• Minimum 620 credit score
• Income limits apply
• FHA loan only
• 30-year fixed rate
• Grant funds can not exceed 3% of the first mortgage
• Grant funds can be used for down payment or closing costs

3. CRHMFA Homebuyers Fund (CHF) – CHF ACCESS

This is a very unique program being operated by all the lenders working under the California Rural Home Mortgage Finance Authority.  Similar to the federally guaranteed loans, the CHF ACCESS loan program requires the borrower to make a down payment of 3.5%.  The attractive part of this loan program is only .50%  is needed for down payment and  3% of it can be available at low interest rate of only 8.5%.

Apartments
Apartment buildings are generally distinguished by factors of age, size and location.

Class A
These types of facilities are large apartment complexes in the most favorable locations featuring many amenities. They are also the most favored of the investment properties. The continuous demand to rent or purchase living space makes large complex apartments a very safe investment once the units have reached a certain level of occupancy.

Most apartment loans of $3 million and higher are sold by the lender. However, some lenders are conduits or lenders who collect loans for a pool and then sell financial interests to institutional investors in those pools.

To achieve the low rates quoted for these loans, lenders underwrite them in narrow bands – or tiers – of risk. Rates are then quoted for each tier. As the risk increases (due to factors of occupancy, market, age and confidence in the borrower), the rate increases. Everyone quotes the best rate, but few properties qualify.

Fortunately, the difference between rates is only a few basis points. One percentage point equals 100 basis points. Rates vary according to term and amortization, but the general rule is: the longer the term, the higher the rate. A fixed-rate loan can be obtained for 30 years, but most are 10-year loans where the rate is lowest.

Not to be outdone, the Federal Housing Administration (FHA) also offers guarantees to lenders for qualifying apartments. These loans usually offer low rates and longer terms – some as long as 40 years for a fixed-rate loan. FHA-guaranteed loans also offer very high loan-to-value as opposed to loans sold to conduits. Although advertised differently, most conduit loans are 70% of the value. FHA loans, however, usually fund up to 85% (and sometimes higher) of the value of the facility.

One of the most thwarting features of conduit or FHA loans is the limitation on secondary financing. Mezzanine loans are used to bridge this gap between equity and the primary loan. They are usually for 10 years or less and cost twice the amount in interest of the permanent loan. In a way, they are like equity because they have no lien on the property. Almost all apartment acquisitions consider mezzanine financing because of the low loan-to-values of conduit loans and the prohibition against secondary liens on the property.

Class B
This class of apartments can and does include all of the former Class A apartments plus those that were never defined as Class A because of size and market location. These complexes are well maintained and have a history of performance catering to the middle class apartment dweller.

In recent years, demand for this product has provided non-recourse financing at pricing rivaling the middle tiers of the risk scale for Class A apartments. Very attractive 10-year financing and FHA-guaranteed financing is also available for these units. FHA financing, while very inexpensive on an annual percentage rate basis because of the long term, has a transaction cost threshold that is not beneficial when the number of units decline below a 100.

Most of these loans are made under secondary market criteria. The major banks, life companies and conduits all provide capital for this market, and some of these sources will accept loans less than $2 million at rates designed for larger loans. If the complex qualifies, this can be a real bonus to the owner.

Modest Apartments
Modest-sized apartment complexes number 15 to 50 units, characterized by a lack of amenities and a mid to lower range of rent. These complexes are identified by the size of their loans, which are usually valued no less than $500,000 and no more than $2.5 million. Because this size is uneconomical to construct in today's environment, units this size are older and do not command the highest incomes.

Nevertheless, there are a lot of complexes this size, and there are many loan programs available to them. If the loan is over $400,000, there is even non-recourse financing. Every loan will require due diligence paid for by the borrower in the form of a Phase I environmental report and appraisal. Some investors have special programs to cap the closing costs, but that feature is also reflected in a higher rate. Those with a lower rate often have higher costs.

The recourse loans available for the acquisition and refinance of these facilities often reflect an 80% loan-to-value with an adjustable feature. There is also long-term fixed-rate financing available for these units. For every $500,000 in loan amount, the number of loans available increases and the interest rates decrease.

Small Apartment Complexes
These facilities range in size from five units to 14 units. The number of units is indicative of the value and probable loan size. Many modest apartment lenders do not have programs for this size project; however, there are national specialty lenders who do seek these loans. Local banking institutions also are especially active in this market. There is no non-recourse financing unless it is located in an exceptionally high-value area, whereby the loan amount will be similar to that of modest-size apartment communities.

There is a significant difference in payment terms available to these units. Local banks feature a low fee basis and limited third party reports, but these savings are offset by adjustable rate loan programs amortized over a 15- to 20-year period. National lenders offer a 30-year loan that significantly lowers the debt service to the borrower. To be competitive on the fee size, these institutions are now offering on par loans and limiting the third party costs by employing their own reviewers.

Apartment Construction Financing
There are special types of construction financing available to apartments in addition to the regular apartment loan. This loan is oriented to the Class A and B apartment communities. It features 90% financing, non-recourse and a fixed rate. The fees for the service are higher than permanent financing but cover both stages of the financing because there is only one closing. This product is thought to contain the most value of any on the market, as its terms are flexible and its overall cost significantly less than any other program.

Smaller apartment financing loans are also available with lower loan-to-values but do permit seller financing of the land if subordinated. These loans are recourse throughout the construction period, and they require the borrower to invest his equity at the time of the first draw in cash or in kind. If the borrower owns the land and it is equal in value to 80% of the total cost, he can use the land as the equity injection instead of cash.