What if you need that down payment assistance? I have a good paying job but if I keep waiting my rent keeps going up and up each year on the renewal. That makes it even harder for me to save up on my own down payment. I got a good paying job pulse lots of over time. 71 hours of work in 6 days.
If you absolutely need it i think downpayment assistance is a great option. My goal isnt to dissuade anyone from owning a home, but to more closely look into the terms of most down payment programs. Check with your local housing authority on what programs they offer!
I’m gonna make a separate video for this but this isn’t actually its own government backed program, but rather a “promo” that Realestate agents participate in with incentives back to teachers. They just advertise already existing loans like CalHFA
Any program that has to raise your interest rates after they “gift “ you some money is not the program you want to go for. By them raising your interest rates, they are getting their money back plus interest by tying it into your loan. GFSA says you have to live in your property for atleast 3 years in order for you to not have to pay them back
Totally doable as well, but if you have a down payment but just need help with closing costs, look into just getting a lender credit in exchange for a higher rate instead of adding an additional mortgage to your property that could hinder you from accessing your equity earlier on
Hey Pedro! I’m gonna do a video on these programs, they provide a ton of funds BUT have some sticky terms that can eat quickly into your equity if you’re not careful
Yeah, found that I would have to chose to live on “certain” streets aka higher crime areas. This doesn’t seem right. It’s what they use for the Home Ready Fannie Mae product, but other places don’t have this requirement for assistance associated with Home Ready product. Wouldn’t need the assistance if they weren’t requiring 6 months reserves.
and i totally understand for a lot of people getting that money out of pocket is an issue! It would take 75 months to save up the $15k for a down payment, that's over 6 years if you're saving only $200/month. For some people the pros of ownership will outweigh the cons of using DPA, but it's important to know the strings attached to them, it's never a free lunch!
@@CatonDelRosario so it’s not a scam, just high cost for the value of the program. :) I’m in another state though, so maybe it’s not so bad here and maybe I’m just not conditioned, as many are, to think I’m getting something for nothing...
There are some states with some AWESOME programs! I’m glad you are because a lot of lenders and agents position down payment assistance as “free money” and don’t talk about the downsides until it’s too late for the buyers.
Im currently doing the gsfa program. You didn’t mention at after 2 years you don’t have to pay the money back. Plus if your putting less the 20% down you still have to pay mortgage insurance.
This was a super general overview but I’m working on videos for both CalHFA & GSFA next :) and for mortgage insurance that’s only true if you’re using an FHA loan.
The SDHC program is good if you actually plan on staying for a long time. Otherwise 17% of your initial equity is tied up and owed back to the county with only 3% that’s actually yours. AND it’s accruing interest of 3% annually, which is a hair under the rate of value inflation for San Diego. You get a home but you really aren’t building much equity.
@@joseambriz4418 Thank you! I’m of the school of thought it’s better to have that flexibility if you can afford the monthly instead of having so much equity tied up with that program. That way if you need to sell within a few years you aren’t losing as much as you would otherwise
You’re welcome! There’s a lot of good programs among the bad but it’s never one size fits all! Read the terms and make sure it meets your long term goals!
CalHFA offers a standalone MyHome program as a second mortgage add on to their normal mortgages (without DPA) that has a 2% interest rate (with no monthly it just accrues interest). I wouldn't recommend it for that reason however.
Isn’t paying a higher interest rate on a second mortgage to get you to a 20% down payment better than paying PMI for the life of the loan with an FHA loan or for 7-10 years with a conventional loan?
As my econ professor said: It depends! Most DPA programs only offer about 3-5% in assistance, not 20%, I'm mostly talking about those programs. PMI isn't some boogey man like a lot of 'gurus' make it out to be. It's a trade off and opportunity cost. It's a cost you pay now to leverage a piece of real estate vs. the time it would take you to save up that 20% where you're going against interest rates, inflation, and housing values. every situation is different, and you'll want to evaluate what your goals are with the property both long and short term!
Just got a quote from my lender here in the central Cali. He brought up both of those options: 3.375% conventional with 5% down, or 3.5% with Calhfa and they'll "help" with about $10k down. Monthly payments will be very similar between the two. What do you think? Also, do you think a 2% loan origination fee is too high? Thanks in advance!
CalHFA is actually in a very agressive spot right now with their rates which is surprising. If you're in the home for longer than 5-7 years thats when you'll see the lower rate outpace the higher one because of how amortization is set up. The "help" is a second mortgage so just be aware of that eating into your equity down the line. 1.5% - 2% is the standard for those loans, but once again that eats significantly into your benefit of using it. You're essentially getting $10k downpayment assistance but paying a significant chunk back to them.
Hi there, I recently pre-qualify with BOA, the homebuyer grant split in 2 different grants. 1 for helping with the closing cost, and 1 for helping with the downpayment. I believe the 1 that help with the downpayment only allow you to buy houses in low income county which are few and far in my state. I am located in GA and the only areas it approved for are area around Savanah GA. The keyword here is "Up to". It does not guarantee you $17,500. Minimum days to close is 45 days if you are using the homebuyer grants. Also, these loan usually capped you at around 200k - 250k. I wish you luck!
I'm in California, looking to buy in Kern county. L.A. county is too expensive unfortunately. I'm qualified for conventional with down payment assistance and closing costs because of my credit. I'm trying to figure out if conventional is a better option vs fha with good credit? I also would like assistance with down payment and closing if possible. GSFA open door was the program offered but I'm not sure if I should use conventional or the fha version.
pretty much 9/10 times Conventional will be your best choice, especially with good credit. GSFA is a solid program since the DPA is forgiven after 3 years, and is prorated per year.
@@CatonDelRosario The GSFA was all offered to me at 3.25% with a 3% silent gift with 2% needed to be paid back. What do you mean when you say "forgiven" and "prorated"? Thanks.
@@CatonDelRosario The GSFA was also offered to me at 3.25% with a 3% silent gift with 2% needed to be paid back. What do you mean when you say "forgiven" and "prorated"? Thanks.
@@katiecasey1735 I'm not sure what program you may be using perhaps in conjunction with GSFA where you have to pay 2% back. GSFA Platinum program features DPA (Down Payment Assistance) in the form of either a Gift or a 2nd Mortgage which is forgivable after 3 years. If it comes as a 2nd mortgage, it is partially forgiven over time. So after 1 Year, you only would owe 67% of the original balance, 33% after two years, and then completely forgiven after the 3rd year. As for the 2% to be paid back, that might just be what your lender is charging you in Origination Points like I mentioned to use the program.
Thank u, you kept the video enthusiastically great professional, my attention didn't loose. I am glad with the honest tips you gave and you are authentic
glad this helped! I hope you got a ton of value from it, just trying to be as authentic as possible since there's so much misinformation out there about these programs!
It’s not FREE down payment money as you mentioned beginning of your video, get your facts right, second we don’t have the money to put down like you said use your own money. Of course there will be interest rate
@@CatonDelRosario but you also said doing something like this is almost not worth owning a home. For ppl who are paying more than half their income (sometimes 2/3) in rent & can’t save up a DP, why discourage them. I pay more in rent, than anyone who owns in my neighborhood. You know why? Renting is a SCAM! especially right now. Why not really explain how you can use these programs and ways to pay off your mortgage quicker than 30 yrs. help ppl!
@@niccolea2086 I don't disagree at all that renting is worse than buying. But I could never confidently push someone to buy a home when they don't have any money in the bank for emergencies or if they'd be better of putting their own down payment. A lot of really scummy people in our industry push these programs as a golden pill for homeownership when in reality, there's a lot of extra fees and costs people don't talk enough about. I've got a few videos that I just need to edit that actually breaks down a few of these programs in CA so I hope you come back to watch those!
*Let me know what questions you have about First Time Buyer Programs!*
I’d love to hear more about the Hero’s first time home buyer programs as I’m a teacher in California 😀
@@bethanymoore1665 absolutely! Shoot me an email caton@amnetmtg.com
Great Info.
Hello i am a probation officer in la county are their any programs that i qualifyfor
I would like to get information about the Calhfa vs fha.
Hi Caton, what do you think about the Teacher Next Door Program? not to be confused with the HERO program,
Ughhh I wish rates were still 3% 😢
Meeee toooo
How is the Sonyma grant
Hello! I am looking at the Teacher Next Door Program. Is this a good one? Thanks!
Is it sketchy if my lender won’t tell me the name of the grant…he keeps just saying that it is a government granr
I wouldn’t call it sketchy but definitely weird that they wouldn’t call it by name. I’d look into that further if you can
I have asked over and over and he just keeps bsing me
Have you recieved a loan estimate already? It would likely show the name of it or at least the terms
Would you recommend CALHFA?
It depends. It’s not bad but it’s also not the best loan
What if you need that down payment assistance? I have a good paying job but if I keep waiting my rent keeps going up and up each year on the renewal. That makes it even harder for me to save up on my own down payment.
I got a good paying job pulse lots of over time. 71 hours of work in 6 days.
If you absolutely need it i think downpayment assistance is a great option. My goal isnt to dissuade anyone from owning a home, but to more closely look into the terms of most down payment programs. Check with your local housing authority on what programs they offer!
Same here!
What about teachers next door for a teacher?
I’m gonna make a separate video for this but this isn’t actually its own government backed program, but rather a “promo” that Realestate agents participate in with incentives back to teachers. They just advertise already existing loans like CalHFA
@@CatonDelRosario can you link the video? Looking into using this program but would like to know outside opinions
Any program that has to raise your interest rates after they “gift “ you some money is not the program you want to go for. By them raising your interest rates, they are getting their money back plus interest by tying it into your loan. GFSA says you have to live in your property for atleast 3 years in order for you to not have to pay them back
Great video. What if people need the down payment assistance so they can afford closing costs? etc
Totally doable as well, but if you have a down payment but just need help with closing costs, look into just getting a lender credit in exchange for a higher rate instead of adding an additional mortgage to your property that could hinder you from accessing your equity earlier on
Anyone here used Landed? I'm looking as a Healthcare employee. As you said in ther HEROS Program me and my wife are looking for long term
Hey Pedro! I’m gonna do a video on these programs, they provide a ton of funds BUT have some sticky terms that can eat quickly into your equity if you’re not careful
@@CatonDelRosario thanks I'll be looking out for sure
All they do is implement it in your monthly payment & push your interest rate up
exactly, always a downside that's worth trying to understand!
Thanks for the video! Super helpful. Do you know much about the Teacher Next Door program? If so, is it something you'd recommend?
I'll check it out!
I also have this question
This was so simply put and now i have a clearer vision. Thank you
You are so welcome
Yeah, found that I would have to chose to live on “certain” streets aka higher crime areas. This doesn’t seem right. It’s what they use for the Home Ready Fannie Mae product, but other places don’t have this requirement for assistance associated with Home Ready product. Wouldn’t need the assistance if they weren’t requiring 6 months reserves.
Hello Caton , Can the down payment assistance loan / second mortgage be paid off to get rid of it ?
Absolutely! No pre payment penalties on those
@@CatonDelRosario OK , I appreciate you , also do you operate in florida?
“If you paid it out of pocket” uh that’s the problem lol
and i totally understand for a lot of people getting that money out of pocket is an issue! It would take 75 months to save up the $15k for a down payment, that's over 6 years if you're saving only $200/month. For some people the pros of ownership will outweigh the cons of using DPA, but it's important to know the strings attached to them, it's never a free lunch!
@@CatonDelRosario so it’s not a scam, just high cost for the value of the program. :) I’m in another state though, so maybe it’s not so bad here and maybe I’m just not conditioned, as many are, to think I’m getting something for nothing...
There are some states with some AWESOME programs! I’m glad you are because a lot of lenders and agents position down payment assistance as “free money” and don’t talk about the downsides until it’s too late for the buyers.
Would your mortgage be cheaper without down-payment assistance?
typically, YES because most down payment assistance programs come with a higher rate.
Im currently doing the gsfa program. You didn’t mention at after 2 years you don’t have to pay the money back. Plus if your putting less the 20% down you still have to pay mortgage insurance.
This was a super general overview but I’m working on videos for both CalHFA & GSFA next :) and for mortgage insurance that’s only true if you’re using an FHA loan.
There are grants to help with down payments that you don’t have to pay back. Why not discuss this?
I mentioned them but not in detail, but I’d be glad to make a video on one of those.
I’m looking for a cheap financial advisor I’m a graduate student here
What do you think of the San Diego HUD first time homebuyer assistance program?
The SDHC program is good if you actually plan on staying for a long time. Otherwise 17% of your initial equity is tied up and owed back to the county with only 3% that’s actually yours. AND it’s accruing interest of 3% annually, which is a hair under the rate of value inflation for San Diego. You get a home but you really aren’t building much equity.
@@CatonDelRosario Thank you for replying. I plan to stay there a long time but things could change. Great Videos btw
@@joseambriz4418 Thank you! I’m of the school of thought it’s better to have that flexibility if you can afford the monthly instead of having so much equity tied up with that program. That way if you need to sell within a few years you aren’t losing as much as you would otherwise
Thank You, very helpful. I considered the Bank Of America program. Now, I know I have a lot more questions to ask. Great video.
Thank you. I'm looking into the HERO next door program and almost pulled out.
You’re welcome! There’s a lot of good programs among the bad but it’s never one size fits all! Read the terms and make sure it meets your long term goals!
Can I get a closing cost assistance with out the down payment assistance. I’ve research that closing cost has no interest in the loan.
CalHFA offers a standalone MyHome program as a second mortgage add on to their normal mortgages (without DPA) that has a 2% interest rate (with no monthly it just accrues interest). I wouldn't recommend it for that reason however.
Yesss great info given. Im so new on these loan. Good to show us the visual break down on loans. Thanks
You’re so welcome!
Do you also provide mortgage to Nevada home buyers?
I have a weird question for you... have you ever owned a Scion XB? or any kind of Scion?
😂😂😂😂😂
Doing a good job keep it up
the sound is not good I am quite disappointed
Sorry to hear that I checked on my end and couldn’t hear any issues? Can you give me some specific feedback so I can improve future videos?
Rural development loans are good because there is no down payment.
I agree!
Isn’t paying a higher interest rate on a second mortgage to get you to a 20% down payment better than paying PMI for the life of the loan with an FHA loan or for 7-10 years with a conventional loan?
As my econ professor said: It depends! Most DPA programs only offer about 3-5% in assistance, not 20%, I'm mostly talking about those programs. PMI isn't some boogey man like a lot of 'gurus' make it out to be. It's a trade off and opportunity cost. It's a cost you pay now to leverage a piece of real estate vs. the time it would take you to save up that 20% where you're going against interest rates, inflation, and housing values. every situation is different, and you'll want to evaluate what your goals are with the property both long and short term!
Just got a quote from my lender here in the central Cali. He brought up both of those options: 3.375% conventional with 5% down, or 3.5% with Calhfa and they'll "help" with about $10k down. Monthly payments will be very similar between the two. What do you think?
Also, do you think a 2% loan origination fee is too high? Thanks in advance!
CalHFA is actually in a very agressive spot right now with their rates which is surprising. If you're in the home for longer than 5-7 years thats when you'll see the lower rate outpace the higher one because of how amortization is set up. The "help" is a second mortgage so just be aware of that eating into your equity down the line.
1.5% - 2% is the standard for those loans, but once again that eats significantly into your benefit of using it. You're essentially getting $10k downpayment assistance but paying a significant chunk back to them.
@@CatonDelRosario great information given. Thank you .
What about the 17500 Bank of America grant, can you give some opinion on this grant ?
How can I contact you for advice ?
Hi there, I recently pre-qualify with BOA, the homebuyer grant split in 2 different grants. 1 for helping with the closing cost, and 1 for helping with the downpayment. I believe the 1 that help with the downpayment only allow you to buy houses in low income county which are few and far in my state. I am located in GA and the only areas it approved for are area around Savanah GA. The keyword here is "Up to". It does not guarantee you $17,500. Minimum days to close is 45 days if you are using the homebuyer grants. Also, these loan usually capped you at around 200k - 250k. I wish you luck!
can you do a video on your desk setup??
I’m getting a new desk soon so once that’s in I’ll definitely post it! Maybe a before and after?
I'm in California, looking to buy in Kern county. L.A. county is too expensive unfortunately. I'm qualified for conventional with down payment assistance and closing costs because of my credit. I'm trying to figure out if conventional is a better option vs fha with good credit? I also would like assistance with down payment and closing if possible. GSFA open door was the program offered but I'm not sure if I should use conventional or the fha version.
pretty much 9/10 times Conventional will be your best choice, especially with good credit. GSFA is a solid program since the DPA is forgiven after 3 years, and is prorated per year.
@@CatonDelRosario The GSFA was all offered to me at 3.25% with a 3% silent gift with 2% needed to be paid back. What do you mean when you say "forgiven" and "prorated"? Thanks.
@@CatonDelRosario The GSFA was also offered to me at 3.25% with a 3% silent gift with 2% needed to be paid back. What do you mean when you say "forgiven" and "prorated"? Thanks.
@@katiecasey1735 I'm not sure what program you may be using perhaps in conjunction with GSFA where you have to pay 2% back. GSFA Platinum program features DPA (Down Payment Assistance) in the form of either a Gift or a 2nd Mortgage which is forgivable after 3 years.
If it comes as a 2nd mortgage, it is partially forgiven over time. So after 1 Year, you only would owe 67% of the original balance, 33% after two years, and then completely forgiven after the 3rd year.
As for the 2% to be paid back, that might just be what your lender is charging you in Origination Points like I mentioned to use the program.
This is such a good video. Respect
Thanks my man! I hope this helps buyers really understand the terms of what they’re getting into by using these kinds of loans
Thank u, you kept the video enthusiastically great professional, my attention didn't loose. I am glad with the honest tips you gave and you are authentic
glad this helped! I hope you got a ton of value from it, just trying to be as authentic as possible since there's so much misinformation out there about these programs!
Is it possible to do a closing cost assistance program and use va loan at the same time?
THIS IS THE INFORMATION I'VE BEEN LOOKING FOR! Everyone keeps saying the $1000 down program is a great deal - but it really isn't.
Every pro has a con especially in finance!
It's a scam but watch my video oh oh plus the commercials 🤦♂️
My account isn’t monetized so if you’re getting commercials don’t look at me lol but thanks for dropping by
Researching becoming an MLO and came across your videos. Great advice on DPA!!
Me too! I’m starting my MLO courses next week! 😃
FhA
It’s not FREE down payment money as you mentioned beginning of your video, get your facts right, second we don’t have the money to put down like you said use your own money. Of course there will be interest rate
I literally mentioned all of this in the video.
@@CatonDelRosario but you also said doing something like this is almost not worth owning a home.
For ppl who are paying more than half their income (sometimes 2/3) in rent & can’t save up a DP, why discourage them.
I pay more in rent, than anyone who owns in my neighborhood. You know why? Renting is a SCAM! especially right now.
Why not really explain how you can use these programs and ways to pay off your mortgage quicker than 30 yrs. help ppl!
@@niccolea2086 I don't disagree at all that renting is worse than buying. But I could never confidently push someone to buy a home when they don't have any money in the bank for emergencies or if they'd be better of putting their own down payment.
A lot of really scummy people in our industry push these programs as a golden pill for homeownership when in reality, there's a lot of extra fees and costs people don't talk enough about.
I've got a few videos that I just need to edit that actually breaks down a few of these programs in CA so I hope you come back to watch those!