Achieving your dream of homeownership in California is no joke. Want the Hollywood glamour? Prominent residential real estate brokerage Compass reported their Q3 2024 prices and discovered you do, in fact, have to be a millionaire to purchase many homes. Single-family homes in Beverly Hills are at a median sales price of $8,400,000, in Santa Monica at a cool $3,400,000, while Sunset Strip will bump you back to $5,200,000. Not a millionaire? Try looking in Inglewood with a sticker price of $890,469.
You’re likely looking to locate in these areas, but the challenge is still real, with an average home in California as of November 2024 setting you back $829,700. Fortunately, there are many local and national loan assistance programs that attempt to provide homeownership for first-time homebuyers, low-income families, and residents of the highest-cost state, California.
California-Specific Programs For First-Time Homebuyer Programs
But first, a joke:
Knock, knock.
Who’s there?
Cal.
Cal who?
CalHFA—because everyone needs a little help knocking on the door of their first California home, you included! 
CalHFA MyHome Assistance Program
Since 1975, the California Housing Finance Agency (CalHFA) has been a state agency focused on providing access to homeownership to low—to moderate-income residents. Its most popular product is the MyHome Assistance program.
Under the MyHome Assistance program, there are two distinct offerings-
CalHFA Government Loans (FHA) – This loan product offers a deferred-payment junior loan of up to 3.5% of the purchase price to help with the downpayment and closing costs.
CalHFA Conventional Loans—This is the same offering, but only up to 3% of the purchase price.
Combined programs
CalHFA VA Program: Borrowers must obtain and present their VA Certificate of Eligibility (COE), a document issued by the US Department of Veterans Affairs.
CalHFA USDA Program: This is a USDA-guaranteed first mortgage loan product that can be combined with the MyHome Assistance Program (MyHome). Note that CalHFA income limits are different from those outlined by CalHFA income limits. See more at USDA income limits.
CalHFA Forgiveable Equity Builder Loan: This program targets low-income, first-time homebuyers and provides up to 10% of the purchase price as a forgivable loan. The catch: As the borrower, you’ll need to live in the home for five years.
CalPLUS Conventional Loan with ZIP (Zero Interest Program): A conventional first mortgage with a deferred-payment junior loan used to cover closing costs.
CalPLUS FHA Loan with ZIP (Zero Interest Program): Similar to the previous loan, this FHA-insured first mortgage again, combined with a deferred-payment junior loan to be used to cover closing costs.
Fun fact: NAR reported that in 2024, first-time buyers accounted for just 24% of the market, marking it as the lowest year on record for this group. This is a significant drop from the 32% share they held in previous years.
Golden State Finance Authority Programs
This public institution that partners with local governments, CalHFA, is focused on providing loan assistance to first-time homebuyers. However, unlike Cal HFA,, it caters to a broader audience including, including repeat buyers. In addition, they also have energy efficiency and community revitalization programs.
“Did you know GSFA Platinum assistance is forgivable for teachers, firefighters, and medical workers?”
GSFA Platinium Program: This product provides up to 5% of the loan amount as a grant, which can be used towards down payment or closing costs. While we’re focused on first-time homebuyers, this is also available to repeat homebuyers. Also, for various occupations such as firefighters, teachers, and healthcare workers, assistance is forgivable, meaning it doesn’t need to be repaid.
GSFA Open Doors Program: This program offers assistance up to 7% of the loan amount for down payment and closing costs. It is a deferred second mortgage, repayable only after the primary loan is paid off, refinanced, or sold.
Illustrating the 5% versus 7% between each program looks like this:
- GSFA Platinum: 5% grant = $40,000 (forgiven).
- GSFA OpenDoors: 7% assistance = $56,000 (deferred second mortgage).
Borrower Requirements
Be a first-time homebuyer: A first-time homebuyer has not owned or occupied a home or lived in a house owned by their spouse in the past three years.
Property requirements: Purchase for a primary residence only; not open to non-occupants, second homeowners, or used as investment properties.
Homebuyer education program: Complete a homebuyer education program and receive a certification of completion through eligible homebuyer organizations. Note that requirements here vary.
CalHFA offers two options for their home education program:
- Online: This option is an 8-hour program with a $99 fee. Note that other courses exist, but CalHFA only accepts the eHome program.
- In-Person/Virtual: Check NeighborWorks America or HUD-Approved Housing Counseling Agency. Fees vary.
Income requirements: The income limit ranges from $174,000 to $300,000, depending on which county/market you’re shopping in. Details on income requirements are outlined here by county.
- The Lowest Income Limit is $174,000 (applicable to multiple counties, such as Glen, Humboldt, Fresno, etc.).
- The highest Income Limit is $300,000 (applicable to counties like Alameda, Marin, San Francisco, San Mateo, and Santa Clara).
Application Process
Now that you’ve understood the process requirements of most of the programs on offer, it’s time to check in on the application process.
- Eligibility Check: Review each program that may be suitable to your needs and see if you qualify (e.g., first-time buyer requirements, income limits)
- Find a local Realtor: Connect with a few local real estate agents, prioritizing one with first-time homebuyer experience and the program/product you’re considering.
- Find a lender: Find one that will service the program you are considering, such as CalHFA or GFSA.
- Mortgage Pre-Approval: Complete the mortgage requirements with the lender. This will help determine how much you can borrow. It also shows sellers you’re a serious buyer, which will help in California’s competitive market.
- Apply for assistance program: Once you receive a pre-approval from your mortgage lender, you can apply for loan assistance programs.
- Complete a Homebuyer Education Course (not applicable on all programs but most)
- Home Search: Find your dream home and ensure it fits your budget. Working with a realtor will help you send an offer and negotiate terms.
- Close on the property: Once your offer is accepted, finalize mortgage documents and loan assistance program requirements.
Top National Programs For First-time Homebuyers
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- FHA Loans: One of the most popular loans, the FHA loan, is typically easier to qualify compared to conventional loans and has a minimum credit score of 580. It is designed for buyers with less-than-perfect credit and allows down payments as low as 3.5%.
- Veteran Affairs Loan: Zero-down payment loans are available for veterans, active-duty military personnel, and certain reservists. One benefit is the lack of private mortgage insurance, which increases affordability.
- USDA Rural Development Loans: Offers zero-down loans for homes in USDA-approved rural areas. Income shouldn’t exceed 115% of the area’s median household income, and the property should meet the geographic rural location requirements.
- National Homebuyers Fund (NHF): NHF has grants or forgivable loans covering up to 5% of the loan amount.
- Good Neighbor Next Door (HUD Program): Teachers, law enforcement officers, firefighters, and EMTs may avail of discounts of up to 50% on homes in designated revitalization areas. One major requirement is to live in the home for three years.
Eligibility Requirements
To qualify for most programs, you’ll need to meet these standard criteria:
Income Thresholds:
- Most programs, similar to those from state agencies, have a maximum income requirement based on your household size and location
Credit Score Requirements:
- Below 580 (Poor): Minimal options.
- 580–669 (Fair): Eligible for FHA loans.
- 670–739 (Good): Better terms and more options.
- 740+ (Excellent): Best rates and more expansive program access.
Geographic Limitations:
- USDA loans require rural locations.
- HUD Good Neighbor properties must be in revitalization zones.
Tax Credit Program
Beyond the state agency programs, there are federal programs and even a tax credit program. Below are the most pertinent programs.
Mortgage Credit Certificate (MCC) Program: This product offers a tax credit toward federal income tax liability. Homebuyers can claim a credit of up to 20% of the annual mortgage interest they pay. Note this is overseen by different agencies and local governments including the GSHA, CalHFA, Los Angeles County Development Authority (LACDA), and San Diego Housing Commission (SDHC,) just to name a few.
Example on a $600,000 Mortgage
- Loan Amount: $600,000
- Interest Rate: 7%
- Annual Mortgage Interest Paid: $42,000
- MCC Credit Percentage: 20%
- Annual Tax Credit: $42,000 × 20% = $8,400
In the example of a $600,000 loan amount, the homebuyer would save over $8000 each year on their federal tax liability through this program.
Helpful Resources
Federal Tools:
California Resources:
- CalHFA
- CalHFA Income Limits by County: Income Limits Tool
- Approved Lenders List: Lenders Directory
- GSFA Homebuyer Assistance
- GSFA Program Income Limits: Income Limits
- GSFA Lender Search Tool: Find a Lender
- Los Angeles County Development Authority
- San Diego Housing Commission (SDHC) First-Time Homebuyer Programs: SDHC Buyer Programs
- Santa Clara County Housing Authority (SCCHA)
Additional resources
- Mortgage Calculators
- Consumer Financial Protection Bureau (CFPB): Guide to mortgage help and first-time home buying: CFPB First-Time Homebuyer Tools
Final tips before action!
Act quickly, as high-demand programs often run out of funds early. Carefully review the eligibility criteria for the programs you’re interested in. To maximize savings, consider combining multiple programs, but be mindful of conflicting requirements. Lastly, consult a real estate expert or lender familiar with assistance programs to ensure you make the most of your options.
With these programs, your dream of homeownership is within reach. Start checking in on your eligibility, or better yet, connect with a local housing counselor.
