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You wish to buy a home in Southern California this year. But with a median sale price of $595,000 for a Riverside home, you worry that homeownership might be just out of reach for you. For first-time home buyers, CalHFA may be able to help you out.
First of all, if you have not owned a primary residence in at least three years prior to the date of purchase of a new property, you are considered a “first-time home buyer”. HUD includes four other scenarios where you may be considered a first-time home buyer even if you previously owned property. Check their website at the link above to see if you qualify. If you meet the criteria of a first-time home buyer, congratulations! You successfully passed the first hurdle in the race to homeownership through CalHFA.
Requirements for the Buyer(s)
After you meet the definition of a “first-time homebuyer”, you must have a minimum credit score of 660 for a low-income loan. Otherwise, you must have a 680 minimum credit score. Additionally, your debt-to-income ratio must not exceed 43% (for manual underwriting) or 45% (for automatic underwriting). In Riverside County, your household income cannot exceed $153,000. Only US citizens, permanent residents, or qualified aliens may apply. Finally, all applicants must complete and present proof of completion of a HUD-approved home buying course.
Requirements for the Property
Along with specific buyer requirements, the property you purchase must also meet certain requirements to qualify. These include a sales price of $765,000 or less. You must maintain this property as your primary residence. Also, it must be located in the United States. If located outside of Riverside County, your household income limit may be different. Talk to your CalFHA advisor if you have any questions. Finally, the property must be a single-family, single-unit residence. However, some condos, guest homes, and manufactured homes may be allowed. Again, discuss this with your advisor if this applies to the property you wish to purchase.
CalHFA Programs
CalHFA offers four programs for government-backed loans (FHA, VA, and USDA) as well as two programs for conventional loans. Just because you meet the requirements for a particular CalHFA program does not guarantee that you will be approved for a loan. Buyers must meet the lender’s requirements as well. The CalPlus FHA and Conventional programs allow you to also use additional financial assistance programs for your down payment and closing costs if needed. But you end up paying a little bit higher of an interest rate.
For more information about these programs, please visit the CalHFA website here. When you want to start looking at homes for sale in the Inland Empire, contact me.
Muna Dionne, your Inland Empire specialist with Coldwell Banker Realty
