New Loan Limits and Down Payment Assistance Information for 2019

Whether you are looking for your first home, downsizing, or moving areas for work or other reasons, buying a new home always starts with financial considerations: We must know what we can afford in order to shop intelligently and not waste precious time and effort. With the new year, the loan limits (above which a loan is considered a jumbo loan and comes with different requirements) have changed. There are also down payment assistance programs I want to tell you about that might help make the moving or the dream of first-time home ownership a reality sooner.

First things first – the disclaimer: I am a Realtor, not a lender. This article is meant to pass on the information kindly provided in a presentation at Tri-Counties Association of Realtors by a licensed lending professional, Liz Bushman, of Academy Mortgage Corp., who can be reached at Liz.Bushman@AcademyMortgage.com for further details, questions, and more information about loans. Nothing in my own words should be used or relied upon as a guarantee of rates, amounts, or conditions of a loan. Please consult a licensed mortgage broker or lender for details on how these programs can benefit you specifically, the rates that can be extended to you, and the loan amounts that you can qualify for based on your personal financial situation. The links to organizations and resources are provided for informational purposes and your convenience only. Please feel free to explore your options with any lenders, sources, and organizations that you are comfortable with. Thank you!

OK, now that the tedious part is out of the way, let me tell you about the good money news first: here are the down payment assistance programs that just might allow you to move into your dream home sooner ūüėä.

1.¬†¬†¬† GSFA Platinum¬ģ¬†Down Payment Assistance Program

“The GSFA Platinum Program helps low-to-moderate income homebuyers in California purchase a home by providing down payment and/or closing cost assistance (DPA). Since 2010, GSFA Platinum has helped 24,000 people to purchase homes, providing more than $213.9 million in down payment and/or closing cost assistance.

Program Highlights*

  • Financial assistance up to 5%, to use for down payment and/or closing costs.
  • Homebuyer doesn’t have to be a first-time homebuyer to qualify.
  • Flexible income limits (low-to-moderate income).
  • Various first mortgage loan types available to fit the needs of the homebuyer
    (FHA, VA, USDA and Conventional financing)

“Does the DPA Have to be Paid Back?

For many homebuyers, the assistance is provided as a zero percent Second Mortgage. The Second Mortgage accrues no interest, has no monthly payments and is completely forgiven after three (3) years from the close of escrow‚ÄĚ (Golden State Finance Authority (GSFA), 2016-2019,¬† http://gsfahome.org/programs/dpa/overview.shtml).

*Certain restrictions apply on all programs. See a GSFA Platinum Participating Lender for complete program guidelines, current interest rates, loan applications, applicable fees and annual percentage rates (APRs.)

  1. CalHFA’s MyHome Assistance Program

‚ÄúOffers a deferred-payment junior loan of an amount up to the lesser of three and half percent (3.5%) of the purchase price or appraised value to assist with down payment and/or closing costs‚ÄĚ (CALIFORNIA HOUSING FINANCE AGENCY, 2018, ‚ÄúDown Payment Assistance Programs‚ÄĚ. https://www.calhfa.ca.gov/homeownership/programs/myhome.pdf)

  1. CalHFA’s STEAP РSchool Teacher and Employee Assistance Program (School Program)

‚ÄúThis program is for teachers, administrators, school district employees and staff members working for any California K-12 public school, which includes Charter schools and county/continuation schools. Applicants must also be first-time homebuyers. School Program junior loans are up to 4% of the purchase price, and can only be combined with an eligible CalHFA first mortgage loan. School Program subordinate loans can only be used for down payment assistance and/or closing costs. Review the sections below to find out more about the School Program‚ÄĚ (CALIFORNIA HOUSING FINANCE AGENCY, 2018, ‚ÄúDown Payment Assistance Programs‚ÄĚ. https://www.calhfa.ca.gov/homeownership/programs/school.pdf )

For more information about these and other CalHFA programs visit: https://www.calhfa.ca.gov/homeownership/programs/

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Now that we have the worries taken from the down payment, let’s look at what happened to the conforming loan limits for 2019 (there are no preset limits on jumbo loans, as those are approved on individual basis and the amounts depend on a whole different set of requirements).

California is a wonderful place that is quite popular with new home buyers, and, as a result, we live on some of the priciest ground in the country. Even without a house, land values in LA and Orange counties can look intimidating. Lucky for us, the new limits for conforming loans have been upped for this year, making it more realistic for us to get them and not have to worry about the additional jumbo-related requirements.

Here are the new conforming loan limits per SoCal county*:

*Foregoing information about loan limits and the minimum down payments was provided by Liz Bushman, Academy Mortgage Corp. Thank you!

VA (100% financing w/full entitlement)

Los Angeles County               $726,525

Orange County                       $726,525

San Diego County                  $690,000

San Bernardino County        $484,350

Riverside County                    $484,350

 

FHA (3.5% down payment OK)

Los Angeles County               $726,525

Orange County                       $726,525

San Diego County                  $690,000

San Bernardino County        $431,250

Riverside County                    $431,250

 

Conventional (3% down payment OK*)

*Los Angeles County              $726,525

*Orange County                      $726,525

*San Diego County                 $690,000

San Bernardino County        $484,350

Riverside County                    $484,350

* loan amounts greater than $484,350 in these counties require 5% down.

Disclaimer: Based on 1-unit properties. In the contiguous states, the loan limits for conventional conforming loan amounts are $484,350. Anything higher becomes a high balance loan.

 

In closing, here is the compilation of resources to check out for more information:

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Marina Alkasas | Realtor¬ģ | Cal DRE License # 02070557 | Century 21 CARE

1081 Grand Ave, Diamond Bar, CA 91765
(909) 305-3519 | marina@malkasas.realtor| http://malkasas.com

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