Those looking to buy a new home now have an additional incentive as the California Housing Finance Agency (CalHFA) has re-instated one of its down payment assistance programs.
CalHFA was able to bring back its School Facility Fee Down Payment Assistance Program (SFF) to help low and moderate income families purchase newly constructed homes, the agency announced Monday. The program was temporarily suspended in July 2009 due to the disruption in the financial markets.
“With the disruption in the bond market, we had to change our business model significantly,” said Ken Jiebel, CalHFA director of marketing.
The newly restored program aids qualified homebuyers who are purchasing newly constructed homes in California. The program provides a conditional grant based on the amount of school facility fees paid by the builder. The assistance helps new homebuyers fund their down payment, closing costs, or any costs associated with their first mortgage loan. The SFF consists of two programs; one is geared toward assisting first-time homebuyers. The other waves the first-time homebuyer requirement and promotes homeownership in specific economically distressed counties.
“We’re pleased to be able to re-start this program and assist California families in purchasing their first homes,” said Steven Spears, Executive Director of CalHFA. “This is one part of our ongoing efforts to support homebuyers at this unique time when homes are more affordable than they have been in many years. Combining CalHFA down payment programs with CalHFA first mortgages can be very helpful to first-time homebuyers.”
Since it began in 1999, 12,604 California families have benefitted from this program. In Stanislaus County, 314 loans have been disbursed for $994,780 and in Merced County 388 loans have been disbursed for $1,536,764.
There is no application or processing fees to apply for the School Facility Fee grant program. The amount of the grant will depend on the amount of eligible school facility fees the developer paid to the school district. Each school district may charge a different fee amount per square footage of the home. As part of the application process CalHFA requires evidence from the builder of how much was actually paid in fees.
According to the Turlock Unified School District, $616,676 in school facility fees was paid by local developers in the 2009-2010 fiscal year.
Local builders are excited about the return of this down payment assistance program.
“We think it’s fantastic,” said Niki Burks of Bright Homes. “I think it’s an added incentive. We can use it in two of our communities — The Falls at Yosemite Vista in Tracy and Bonita Ranch in Keyes.”
She said that the SFF would save buyers at Bonita Ranch $1,500 and buyers at The Falls $3,000 to $7,000 in closing fees.
“The School Facility Fee program has provided thousands of California homebuyers a cash incentive to purchase a brand new home,” said Elizabeth Snow, CEO of the California Building Industry Association. “Home Builders in California are excited to see SFF return to the home buying scene.”
Last month, CalHFA also announced the launch of a new below market fixed rate, 30-year FHA loan. The CalHFA FHA provides low and moderate income, first-time home buyers access to mortgages with affordable payments and other benefits.
For complete program eligibility requirements and instructions on how to apply for the School Facility Fee Down Payment Assistance Program, visit www.calhfa.ca.gov or call (877) 922-5432.
To contact Kristina Hacker, e-mail email@example.com or call 634-9141 ext. 2004.