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Forgivable Equity Builder's Loan

Written by
David Watermeier
October 3, 2022

Californian’s can take advantage of CALHFA’s new 10% down payment assistance program. The requirements to be eligible for this program is quite beneficial to first time home buyers looking to purchase a home anytime in the foreseeable future.

Every single first time home buyer in California should be looking at this great opportunity as something they may be able to qualify for. It is pretty much free money, with some requirements to be met of course.

Some lenders and realtors have the perception that this program is only possible with a very low loan amount, but they are quite wrong. Each mortgage loan that someone has should be personally tailored to meet their financial goals. For example, the down payment assistance can also be used as a rate buydown instead of pure down payment. If someone is planning on owning that home for the entire life of the loan. This rate buydown can potentially decrease their payments more than a higher down payment and also save them more money in the long run.

Here are some basic requirements that people should consider about their own financials if they would like to qualify:

  1. Must be first time home buying.
  2. 80% median income of the county where the home is at to qualify. Example: Alameda County 108k, Orange County 68k.
  3. All co-borrowers must be living in the house too. Keep in mind that co-borrowers increase the total income possible disqualifying you from the program.
  4. You must live in the home for 5 years for it to be fully forgiven, this is why this particular program is great. It's free money, a lot of other down payment programs just defer the payments until the first mortgage is paid off.
  5. Every year that you live there 20% of the down payment is forgiven, resulting in the loan totally forgiven after 5 years.
  6. It works for many types of loans. (Conventional, FHA, VA)
  7. You will need an 8 hour homeowner education course before closing, which costs $99.
  8. Minimum 640 credit score, and 45% maximum debt to income ratio. This ratio is your total monthly debts compared to your total gross monthly income you make per month. So for example, if you bring in $10,000 per month (before taxes), then 45% would be $4,500 that your total debts, what your combined mortgage/car/credit payments can be.
  9. The down payment program also pays for all closing costs except appraisal and credit report.

Please email or call David at 714-989-3252 for some more in depth explanation. Or feel free to send an email at

The actual CalHFA loan page can be found here: