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Down Payment Assistance Program
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PURPOSE: To expand homeownership opportunities to low and moderate-income persons by providing a down payment assistance loan.
WHAT IS THE DEFINITION OF FIRST-TIME HOMEBUYER? A household who has not owned its principal place of residence within the last three (3) years, or if you are a displaced homemaker.
WHO IS ELIGIBLE FOR A FIRST-TIME HOMEBUYER LOAN?: Households whose gross income does not exceed 80% of the Area Median Income, adjusted by household size. Income limits follow the State of California Housing and Community Development (HCD) Community Development Block Grant (CDBG) Program and HOME Investment Partnerships Program guidelines, which are updated annually. All eligible applications are subject to loan committee approval.
WHAT TYPE OF UNIT CAN I BUY?: Homebuyers may purchase a new or existing single-family, condominium, or townhouse unit. Homes must be on a permanent foundation system. Total purchase price cannot exceed $ 225,000.
MUST THE HOME BE IN THE CITY LIMITS?: Yes, the home must be located within the city limits of the City of Shasta Lake.
HOW MUCH CAN I BORROW?: The amount borrowed is the minimum needed to close the gap between the primary lender requirements and the buyers 3% contribution, but not to exceed 40% of the purchase price or $80,000. THE BORROWER MUST CONTRIBUTE 3% OF THE SALE PRICE WITH HIS/HER FUNDS.
WHAT ARE THE TERMS OF THE LOAN AND INTEREST RATE?: Loan repayment is deferred for 30 years at an annual interest rate of 0% (equity share conditions may apply). Borrower must pay the loan balance if property is sold, transferred, or converted to rental property at any time during the loan period. The City of Shasta Lake First Time Homebuyer Program loan is recorded as a second mortgage against the property.
IS OWNER OCCUPANCY REQUIRED?: Yes.
WHAT HAPPENS IF A HOMEBUYER DECIDES TO SELL DURING THE TERM OF THE LOAN?” The City of Shasta Lake First-Time Homebuyer DAP Loan is recorded as a second mortgage against the property. The balance of the second mortgage, plus any applicable equity share will be due and payable in full.
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*2004 State CDBG’s and HOME’s Income Limits (2007)
The City of Shasta Lake will update these limits annually as HCD provides new information. The link to the official, HCD-maintained, income limits is: http://www.hcd.ca.gov/hpd/hrc/rep/state/incNote.html |
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Housing Programs
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Down Payment Assistance Program |
