CALHFA CHDAP Down Payment Assistance Program Reduces DTI to 43%

The California Housing Finance Agency (CalHFA) significantly revised their guidelines to reduce how much a first time home buyer can qualify for when using their 3% California Homebuyer’s Downpayment Assistance Program (CHDAP).

CalHFA has recently reduced the max DTI from 45% to 43%.  What does this mean to you as a borrower?  If you qualified for a $350,000 Purchase Price at 45% DTI, you would now be reduced to a $330,000 Purchase Price at 43% DTI.  That’s a big deal, especially if you are a higher purchase price.

Borrower Eligibility

Borrower Requirements

Each loan program that CalHFA offers to homebuyers can have different criteria for income limits, minimum credit scores, citizenship etc. To learn about specific requirements and benefits for each program, review the program descriptions on the Loan Programs tab.

Visit our Mortgage & Eligibility Calculators section to assist you in estimating your monthly payments, how much you can afford, and which CalHFA programs you may be eligible for.

In general these are borrower eligibility requirements for all CalHFA programs:

• You must be a U.S. citizen, permanent resident or other qualified alien.
• You will need to meet credit, income limits and loan requirements of the CalHFA-approved lender and the mortgage insurer.
• You will need to live in the home you are purchasing for the entire term of the loan, or until the home is sold or refinanced.
• CalHFA borrowers must complete homebuyer education counseling and obtain a certificate of completion through an eligible homebuyer counseling organization.
• CalHFA’s down payment programs CHDAP, ECTP and MCC require you to be a first-time homebuyer. See the definition of a first-time homebuyer.

Below is the Bulletin from CalHFA.

Click to access 2014-17.pdf