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Who does down payment assistance home loan programs in California

April 8th, 2020 5:31 PM by Nathan Rufty

For most first-time homebuyers, the greatest obstacle to owning a home is the down payment. Fortunately, to help fill this need, homebuyers throughout the State of California can access different assistance programs that enable them to reach the dream of homeownership. The federal, state and local government, and non-profit organizations have designed programs to help very low, low- and moderate-income buyers attain homeownership that wouldn’t be otherwise possible. Some of the programs offered are available on a statewide basis, while others are available only locally, since they have been specially designed for residents of a particular community or for individuals with a special set of housing constraints. It is always recommended to approach the originating housing entity to find about the particular requirements and scope of any given program. 


It is the intent of the City of Ceres to offer first-time homebuyer downpayment assistance to very low and low-income households for the purchase of qualified homes in the City of Ceres. The City of Ceres’ First

Time Homebuyer Downpayment Assistance Program (DAP) supports first time homebuyers purchasing market rate homes in Ceres with assistance up to the DAP maximum loan limit, currently $80,000, in

order to provide a larger down payment contribution, therefore lowering the monthly mortgage payment.

Funding for this program may come from either of two sources: the HOME Investment Partnerships Program (HOME) and the CalHome Program. HOME funds are provided by the California Department of Housing and Community Development (HCD) and made available by the U.S. Department of Housing and Urban Development (HUD).


  • CalHome funds are made available through HCD. 3 The Administrative Procedures are also available on the City’s website at www.ci.ceres.ca.us. 
  • These Procedures may be amended and updated from time to time. Please refer to the City’s website to determine the most current version of these Procedures. 
  • Purchase assistance programs, whether down payment, closing costs, prepaid or rate-buy-downs take the form of loans or grants. These financial delivery mechanisms are designed to help households reach the dream of homeownership.


Loans usually are deferred, low-to-zero-interest and require back payment at the time of sale or transfer of property. Loans are sometimes referred as Soft or Silent Seconds, depending upon whether the loan is to be paid at a low interest rate or it is forgiven after a certain conditions are met. The loan originator can be the state, a regional, local or non-profit housing agency.

The most common conditions attached to any loan program are:


  • First time buyers must not have home ownership in any property within the last 3 years.
  • Purchase price and income level limits are based on area medians for family size, usually to HUD standards.
  • Assistance with 0–20 percent of purchase price or a fixed quantity, whichever is less.
  • Below market interest rate deferred until sale or transfer of the home.
  • Balloon payment of loan at the time of transfer or selling of property.


Grants are money gifts where the no back payment by the buyer is required, but where a fee-for-use is required as well as a contribution from the seller. Grant providers are usually more flexible than loan providers in the set of conditions attached to the funding process. Grant originators typically are non-profit organizations.



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