~ Down Payment Programs Return
~ Cal30 Expands Reach of CalHFA First-Mortgage Lending
~ Board Member Appreciation
~ CSHLP Adds More Counties
~ Hot Tips for Keeping Cool This Summer
Message from Steve Spears, Acting Executive Director
We find ourselves in tumultuous circumstances, nearly without precedent in our lifetimes. Nonetheless, those of us who have dedicated ourselves and our agencies to high public purposes cannot simply walk away from our responsibilities and missions. Instead, we must re-dedicate ourselves to finding the path forward that will allow us to continue that mission; in CalHFA's case, the mission to provide sustainable financing for safe, sound and decent housing for low and moderate income Californians.
The first step on that path for CalHFA is to get back to our mission of lending. We are taking steps toward ramping up our production levels, the first of these being the reintroduction of a CalHFA first mortgage program, Cal30. We have also reintroduced the California Homebuyer's Downpayment Assistance and School Facility Fee Down Payment Assistance Programs. You can read more details in the article below, titled Down Payment Programs Return.
A second step is to continue reinforcing our commitment to the next generation by showing children what the work behind affordable housing is really like. Check out what CalHFA's been doing on that front in the short story along this newsletter's side bar, titled Future Housing All-Stars.
A third step is to expand on existing products and make them available to more people. Additions to the Community Stabilization Home Loan Program point us in the right direction on that front. See what additions have been made in the article below, titled CSHLP Adds More Counties.
Finally, we can make sure our own houses are in order—literally. Take a moment to peruse our helpful hints for the summer, as they might even save you a few bucks.
In addition to the above highlights, our multifamily division continues to bring in new projects through the Mental Health Services Act, helping those with mental disabilities find affordable places to live. Multifamily will also be playing a role in President Obama's economic stimulus package, as they have been asked by the State Tax Credit Allocation Committee to assist with tax credit gap financing and other aspects of the Tax Credit Assistance Program.
We do not have a crystal ball to see the future and know exactly where our path will lead us. What we are committed to doing is making each step on the path count, and ensuring that each step is taken deliberately and thoughtfully. There's a lot riding on the next several months, and we're doing our best to make those steps into strides. Thanks for your continued support.
Down Payment Programs Return
It has been a difficult past several months for California and Californians, especially in the housing industry. CalHFA, however, is happy to say that we have some rays of sunshine after all the clouds.
First off, Governor Schwarzenneger authorized the freeing up of a portion of our Proposition 46 and 1C bond funds. This enables us to begin offering some of our down payment assistance options again.
The School Facility Fee Down Payment Assistance Program provides qualified homebuyers with a partial or full rebate of the school facility fees paid by the home builder. While the amount varies according to school district and square footage of the home, the average rebate is approximately $5,100. This is a conditional grant, not a loan, so if the buyer occupies their home for five years, the grant is theirs to keep. If the home is owner-occupied less than five years, the conditional grant must be repaid on a pro rata basis.
The California Homebuyer's Downpayment Assistance Program, or CHDAP, provides first-time homebuyers with a deferred loan equal to three percent of a home's value. Under the program, homeowners do not have to repay the loan until the home is sold, refinanced or paid in full. CHDAP has funded more than 25,000 loans for over $195 million.
One helpful feature of these two programs is that they both can be used independently of CalHFA first loans. One of the programs under SFF is even available to people who are not first-time homebuyers.
Finally, CalHFA will be able to honor all its outstanding commitments to the Residential Development Loan Program, which provides local communities with low-interest funding to work on infill development of affordable, single-family owner-occupied homes. The money is available to California cities, counties, housing authorities, redevelopment agencies and community development commissions.
Although this is certainly good news, CalHFA is not content to rest. We have just introduced the Cal30 first mortgage product, and are also working on new products. Please make sure you visit our web site frequently to keep up with developments.
Cal30 Expands Reach of CalHFA First-Mortgage Lending
CalHFA is pleased to announce the introduction of the Cal30 first mortgage loan. Cal30 combines the predictability of a low fixed interest rate with the attainability of an achievable credit score. This new loan program is available for eligible first-time homebuyers across the entire state. Cal30 offers fixed mortgage payments for the life of the loan – with no changes in the monthly payment and no surprises for borrowers. Added to the SMART and Community Stabilization Home Loan Programs, Cal30 marks a return to California-wide lending after a brief period in which CalHFA concentrated on REO properties.
"We are eager to use Cal30 and our other assistance programs to help meet the housing needs of California families," said Steve Spears, Acting Executive Director of CalHFA. "While the financial market turmoil continues and California faces unique challenges economically, there is perhaps no more important time for our agency to work on behalf of families statewide."
"Because of the decline in real estate prices, the number of Californians who can now afford to buy their first home is twice what it was at this same time last year," Spears said. "CalHFA is excited to introduce this new program as we begin to mark National Homeownership Month and recognize that homeownership enhances entire communities."
To use CalHFA's programs, homebuyers must meet certain income and sales price guidelines for low and moderate income families. The guidelines are set according to county and are quite generous in most areas. For example, a family of four or more in Santa Clara County could use CalHFA's programs if the household income is $126,600 or less and the home being purchased is $637,645 or less.
"Cal30 is a positive step forward for CalHFA to be able to again offer a safe, 30-year mortgage to the market," Spears said. "As the financial markets improve, we will continue to identify additional opportunities to assist first-time homebuyers."
CalHFA will also be working closely with lenders and loan officers to shorten processing times on Cal30 and other loans. Said Spears, "In today's market, banks and lenders must be quick and efficient; we owe it to our business partners to provide them the quality service they deserve."
Cal30 is available in all 58 counties of California, and can be combined with other forms of CalHFA assistance, including the California Homebuyer's Downpayment Assistance Program, School Facility Fee Program and Affordable Housing Partnership Program. If Cal30 is used to purchase a new home in California, you may also be able to qualify for a state tax credit—check out the Franchise Tax Board's site for more information.
Board Member Appreciation
We are sad to announce that two of our Board members have retired from the CalHFA board after years of devoted service, and pleased that they will continue their work in the affordable housing sector.
CalHFA Board Members Carol Galante was tapped by President Barack Obama as the new Deputy Assistant Secretary for Multifamily Housing Programs at the U.S. Department of Housing and Urban Development (HUD).
As Deputy Assistant Secretary, Galante will be responsible for HUD's financing support for the development and preservation of privately-owned rental housing (a current portfolio of over $58 billion) and will be integral to several new initiatives that promote sustainable development.
Said HUD Secretary Shaun Donovan, "She is one of the nation's most innovative affordable housing leaders and will be a tremendous asset during our nation's housing crisis, especially as HUD moves forward an aggressive policy agenda. I am thrilled to have Carol on board and look forward to working with her to carry out HUD's mission to create affordable housing opportunities for all Americans."
Board Member Carla Javits has also taken leave of the CalHFA board to spend more time at REDF, the venture philanthropy of which she is president. REDF creates job opportunities through support of social enterprises that help people gain the skills to help themselves. Their unique approach has helped more than 3,700 people find jobs and stay employed.
Congratulations to Carol and Carla and a hearty thank-you for their years of service on the CalHFA Board of Directors.
Two New Board Members
We are also happy to welcome two new members to the CalHFA board. Ruben Smith, of Aliso Viejo, was appointed by Governor Schwarzenegger on December 5, 2008. Mr. Smith's depth and breath of experience includes serving as a founding shareholder to Adorno Yoss Alvarado & Smith, the Los Angles City Council, the White House Office of Hispanic Affairs and the California Department of Finance. He is a member of the City National Bank Hispanic Advisory Council, Orange County Bar Association and others. Mr. Smith holds a Juris Doctorate degree from Yale University, as well as a Master of Public Administration and a Bachelor of Science from the University of Southern California.
On June 16, 2009 the Senate Rules Committee announced the appointment of Jonathan C. Hunter, of La Mesa, to the CalHFA Board of Directors. Mr. Hunter is the President and Managing Director for the Corporation for Supportive Housing, which helps communities create permanent housing with services to prevent and end homelessness. Mr. Hunter's career has focused on serving those in need of housing and supportive services. Mr. Hunter developed housing projects that provided both transitional and permanent housing solutions for homeless people with severe mental illness. Programs designed by Mr. Hunter were recognized at both the state and national level for innovation in responding to the needs of homeless adults and families.
CSHLP Adds More Counties
The Community Stabilization Home Loan Program was created last year to help some of our partner banks sell their foreclosed properties to first-time homebuyers. This pilot program focuses on several specific areas of the state that ranked highly in different measures of foreclosure distress, and tries to mitigate the effects of foreclosures on communities by offering properties at a reduced price with a low interest rate.
The program started with a small number of counties, and has gradually expanded as resources become available. Three more counties have been added to the eligible list: Kern, San Bernardino and Solano. They join Merced, Monterey, Riverside, Sacramento, San Benito, San Joaquin, Stanislaus, and select ZIP codes in Alameda and Los Angeles counties.
The CSHLP program, in addition to featuring a low interest rate, can also be combined with CalHFA's California Homebuyer's Downpayment Assistance Program, which provides first-time homebuyers with a deferred loan equal to three percent of a home's value. The program can even layer with local down payment assistance via the Affordable Housing Partnership Program.
CalHFA also has other foreclosed properties that qualify for low-rate, 100% financing. The SMART program offers these benefits to first-time homebuyers in 24 counties across the state, and can be combined with the same down payment assistance programs as CSHLP.
The CSHLP and SMART lists of properties change every week—be sure to keep an eye on our web site so you don't miss out!
Hot Tips for Keeping Cool This Summer
As we all know, California can get hot when the sun gets high, one of the blessings and occasional curses of our fantastic climate. Here are some tips to help you beat the heat for the rest of the summer.
- Close your drapes during the hottest times of the day to block out heat.
- Make sure your attic vents are clear, and any attic fans are functioning properly.
- Keep your house closed during the day and ventilate it at night.
- Seal doors and windows to keep the hot air where it belongs: outside.
- Turn off computers at the power strip—whirring fans emit heat.
- Turn off incandescent lights, or replace with fluorescents. About 95% of an incandescent bulb's energy goes toward heat, 5% to light—that filament heats up above 3,000 degrees Fahrenheit.
- Use your microwave instead an oven—they use 2/3 less energy, and emit far less heat.
Central Air Conditioning
- Consider installing a heat pump if you're building a new home or remodeling. They can be the most cost-effective way to heat and cool your home.
- Check your air filters monthly and keep your system running efficiently.
- Keep your vents open and unobstructed.
Window Air Conditioning
- Get the right size window AC unit. Too small won't cool effectively, while too large will use too much energy.
- Buy an ENERGY STAR qualified model.
- Use ceiling and floor fans to keep cool air circulating through your house—they use 1/100th the energy of your air conditioning.