PROGRAM DESCRIPTION

The Extra Credit Teacher Program (ECTP) is designed to make homeownership a possibility for eligible teachers, administrators, classified employees and staff members working in high priority schools in California.

The ECTP is intended to help high priority schools attract and retain education professionals by offering an incentive in the form of down payment assistance for the purchase of a home anywhere in California.

The Program provides:

1. A deferred payment, junior mortgage loan for down payment assistance of an amount not to exceed the greater of $7,500 or 3% of the sales price, or; of an amount not to exceed the greater of $15,000 or 3% of the sales price in CalHFA-defined high cost areas .

2. A special reduced interest rate on the CalHFA 30-Year Fixed Mortgage or Government Insured/Guaranteed 30-year fixed Mortgage. All program and underwriting guidelines that apply to CalHFA’s other first mortgages loans also apply to the ECTP first mortgage loan.

(The special reduced rate is not available on the CalHFA interest only PLUS^SM or the 40-Year Fixed Mortgage loan programs.)

Interest on the junior loan is deferred and may be reduced to zero if the borrower meets continued eligibility requirements.

In addition, CalHFA will permit homebuyers to use other CalHFA-approved down payment assistance loans or grants to help in the acquisition of the home.

TARGET MARKETS

This program is intended for eligible teachers, administrators, classified employees and staff members employed in high priority schools across the state.

A High Priority School is a California K-12 public school that:

1. Is ranked in the bottom 50% of all schools based on the most recent Academic Performance Index, i.e. schools receiving an API Statewide Ranking of 1, 2, 3, 4 or 5; or
   
2. Does not have an API ranking but 70% or more of the school’s pupil enrollment is eligible for free or reduced price meals; or
   
3. Is a County Continuation school

PARTICIPATING LENDERS

CalHFA- approved lenders .

BORROWER ELIGIBILITY

Borrowers must meet the following requirements :

• Be a U.S. citizen or permanent resident alien or qualified alien
• Be a first-time homebuyer
• Occupy the property as a primary residence; non-occupant co-borrowers are not allowed
• Be currently employed in a public or charter school that scores in the bottom fifty percent (50%) statewide Academic Performance Index rank (API ranks 1-5), or be assigned to a school district but teach in, provide administration in or provide service to at least one high priority school
• Have an income that does not exceed CalHFA’s income limits established for the county in which the borrower is purchasing
• Meet credit, income and loan requirements of the CalHFA lender and the mortgage insurer
• Hold an appropriate credential for a teacher, administrator or staff member (Extra Credit Teacher Program Credential List follows) or be employed as a Classified Employee. “Classified Employee” means an employee of a school district, employed in a position not requiring certification qualifications.
• Intend to work for three years continuously from the date of the loan in a high priority school

ELIGIBLE CREDENTIAL LIST

For Teachers: (Credential held must be either a Preliminary or  Full Credential.  Intern Credentials and Emergency Permits are not eligible under the program.)

• Single Subject Teaching Credential
• Multiple Subject Teaching Credential
• Specialist Instruction Credential in Special Education
• Education Specialist Instruction Credential
• Standard Elementary Teaching Credential
• Standard Secondary Teaching Credential
• Standard Early Childhood Education Teaching Credential
• Standard Restricted Special Education Teaching Credential
• General Kindergarten-Primary Teaching Credential
• General Elementary Teaching Credential
• General Junior High Teaching Credential
• General Secondary Teaching Credential
• Special Secondary Teaching Credential in Art
• Special Credential for Teaching Exceptional Children
• Special Secondary Teaching Credential in Business Ed
• Special Secondary Credential for Teaching the Blind
• Special Secondary Teaching Credential in Homemaking
• Special Secondary Teaching Credential in Industrial Arts
• Special Secondary Credential for Teaching Lip Reading
• Special Secondary Teaching Credential in Music
• Special Secondary Limited Teaching Credential in Music
• Special Secondary Teaching Credential Limited in Agriculture
• Special Secondary Credential for Teaching the Partially Sighted Child
• Special Secondary Teaching Credential in Physical Education
• Special Secondary Speech Arts
• Special Secondary Teaching Credential in Correction of Speech Defects
• Special Secondary Credential for Teaching the Mentally Retarded

For Administrators :

• Administrative Services Credential
• General Secondary School Administration Credential
• Administrative Services Credential (Examination)
• General Secondary School Supervision Credential
• Standard Supervision Credential
• General Administration Credential
• Standard Administration Credential
• General Supervision Credential
• General Elementary School Administration Credential
• The Supervision Credential
• General Elementary School Supervision Credential
• General School Principal or Supervisor Credential

For Staff Members:

• School Nurse Credential
• Clinical or Rehabilitation Service Credential
• Pupil Personnel Services Credential - (e.g. School Counseling, School Social Work, School Psychology and Child Welfare and Attendance)
• Library Media Teacher Service Credential
• Designated Subjects Vocational Education Teaching Credential

ELIGIBLE CLASSIFIED EMPLOYEES

For Classified Employees:

Classified Employee means an employee of a school district, employed in a position not requiring certification qualifications.

PROPERTY ELIGIBILITY

Properties must meet the following requirements :

• Sales price of the home cannot exceed CalHFA’s sales price limits established for the county in which the borrower is purchasing
• Be a single-family, one-unit residence, including condominium /PUD
• Manufactured housing must meet eligibility requirements
• Meet the requirements of the mortgage insurer/guarantor of the first mortgage loan

TRANSACTION TYPE

Purchase transactions only.

INTEREST RATE

CalHFA offers a unique interest rate for this program. A list of current rates is also available by contacting a CalHFA- approved lender .

MAXIMUM LOAN AMOUNT

• Amount not to exceed the greater of $7,500 or 3% of the sales price in CalHFA-defined non-high cost areas or,
• Amount not to exceed the greater of $15,000 or 3% of the sales price in CalHFA-defined high cost areas.
• Under no circumstances can the Combined-Loan-to-Value exceed 102% when utilizing any combination of CalHFA first mortgage loans and subordinate loan products or approved programs.

INTEREST FORGIVENESS ON THE JUNIOR LOAN

Interest on the junior loan may be reduced to zero if the borrower meets continued eligibility by remaining employed in a high priority school on a continuous basis for three years from the date specified on the junior loan documents. The interest rate on the junior loan will be reduced by 1% for each full year borrower remains employed in a high priority school, up to a maximum of three years. At the end of three years, the rate is reduced to zero.

In the event of termination of employment during the first three years, the interest rate on the junior loan will accrue at the last reduced rate (if applicable) that the borrower met continued eligibility.

REPAYMENT OF SECOND LOAN

Repayment of the principal and interest on the junior loan shall be due and payable at the earlier of the following events:

• Transfer of title
• Sale of the residence
• Payoff or refinance of the first loan
• Upon the formal filing and recording of a Notice of Default (unless rescinded)

PROGRAM RESTRICTIONS

ECTP cannot be combined with CalHFA’s California Homebuyer’s Downpayment Assistance Program (CHDAP).

HOW TO APPLY

Borrowers apply through one of CalHFA’s approved lenders.

Lenders make reservations through CalHFA’s Lender Access System (LAS). Follow procedures outlined in Lender Program Manual.

QUESTIONS

Questions regarding the Extra Credit Teacher Program should be directed to CalHFA- approved lenders or the CalHFA’s Homeownership Division-Special Programs at:

P.O. Box 4034 , Sacramento, CA 95812
Phone: 877.9.CalHFA
Email: homeownership@calhfa.ca.gov