California Mortgage Overview
California is the Golden State — home to
many of the country's largest cities, it has a diverse population and plenty of
sunshine to go around.
The median home price in California is
$505,000, so it's not the least expensive place to live, but if it's within
your budget, there are beautiful homes to purchase for families of all sizes.
If you're looking to borrow money for a
California home, here are your options.
California conventional loans
great credit get the best terms with a conventional loan. You don't need
perfect credit - usually around a 660, but your debts must be under control
too. Show lenders, you're a good borrower and you'll snag the low rates available
California FHA loans
If you have
less-than-perfect credit or your credit card debt is higher than conventional
lenders like the FHA loan is a good option. With more flexible guidelines, you
only need a 580 credit score and a 3.5 percent down payment. Some borrowers get
a loan with as little as a 500 credit score, but a 10 percent down payment.
California VA loans
If you served our country,
the VA has your back. You can get a loan with 100 percent financing (no down
payment). As long as you prove you have enough money to cover your debts and
living expenses, have 'decent' credit, and any discharge other than dishonorable,
you're well on your way to buying your first home with a VA loan.
California USDA loans
If sunshine and low
populated areas sound great to you, check out the California USDA loan. Borrowers
with at least a 640 credit score and income that's less than 115% of the area's
median income may be eligible for this no down payment program with low rates
and closing costs.
First-Time Homebuyer Programs in California
The California Housing Agency helps
first-time homebuyers with any credit score or qualifying factors secure
financing. As long as you meet the income
requirements, you may be eligible for the following:
- CalHFA FHA or CalPlus FHA Loan
- CalHFA VA Loan
- CalHFA USDA Loan
- CalHFA Conventional Loan or CalPlus Conventional Loan
Each is a 30-year fixed rate loan and can
be combined with the MyHome Assistance Program which provides funds toward your
down payment or closing costs usually at 0% interest. The loans are deferred
until you sell or refinance the home.
The MyHome Assistance Program has a $10,000
cap and/or up to 3.5 percent of the sales price depending on the loan.