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State Guide

First-Time Homebuyer Programs in California

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Overview

California first-time homebuyer assistance is led by the California Housing Finance Agency (CalHFA) at the state level and by an unusually deep bench of city and county programs in the major metros. CalHFA's flagship products include the Dream For All Shared Appreciation Loan (up to 20% of the purchase price as a shared-appreciation second, subject to annual funding availability and operated on a lottery basis in recent cycles), the MyHome Assistance Program (up to 3.5% of the loan amount as a deferred second mortgage), and the Zero Interest Program (ZIP) for closing cost assistance that layers on top of MyHome. Because California's housing costs are by far the highest in the continental US, city-level programs in California are also much larger than in other states: Los Angeles offers up to $140,000 through the LAHD Affordable Homeownership Program, San Francisco offers up to $375,000 through the MOHCD Down Payment Assistance Loan (the highest city-level assistance amount in the country outside of Washington D.C.), San Diego offers up to $100,000 through the Affordable For Sale Housing Program, Oakland offers up to $50,000 through the Oakland Homebuyer Assistance Program, and Sacramento offers up to $22,000 through the Sacramento Housing and Redevelopment Agency. Most of these city programs are structured as deferred or shared-appreciation seconds due on sale or refinance rather than forgivable grants, and most run on funding cycles or lotteries that can exhaust mid-year.

Down Payment Assistance Programs

  • CalHFA Dream For All Shared Appreciation Loan. CalHFA's flagship statewide down payment assistance product: up to 20% of the purchase price as a shared-appreciation second mortgage paired with a CalHFA first mortgage. Dream For All carries no monthly payment and no interest in the conventional sense - instead, the borrower repays the original principal plus a share of the home's appreciation when the home is sold, refinanced, or no longer the primary residence. Funding is appropriated by the state annually and has been operated on a lottery basis in recent cycles because demand vastly exceeds supply; in some application windows the program has fully subscribed within hours. Eligibility includes first-time buyer status (defined as not having owned a primary residence in the prior three years), CalHFA income and purchase price limits, HUD-approved homebuyer education, and at least one borrower meeting CalHFA's California residency criteria. Confirm current funding availability, application window status, and lottery mechanics with a CalHFA-approved lender or at calhfa.ca.gov before counting on Dream For All in your offer.
  • CalHFA MyHome Assistance Program. CalHFA's primary always-on down payment assistance product, providing up to 3.5% of the loan amount as a deferred second mortgage structured at a low simple-interest rate, with no monthly payments and repayment due when the home is sold, refinanced, or no longer the primary residence. MyHome pairs with a CalHFA first mortgage (FHA, VA, USDA-RD, or conventional including CalHFA's HFA Preferred conventional product) and is the workhorse DPA program that is generally funded year-round when Dream For All is closed. Compatible with the Zero Interest Program (ZIP) for additional closing cost help and with most city DPA programs in Los Angeles, San Francisco, San Diego, Oakland, and Sacramento.
  • CalHFA Zero Interest Program (ZIP). A CalHFA closing cost assistance product structured as a 0% interest deferred second mortgage that layers on top of MyHome to cover closing costs and prepaid items (escrow setup, first-year homeowners insurance, prorated property taxes). ZIP is specifically designed to stack with MyHome rather than replace it - MyHome covers the down payment, ZIP covers closing costs - so eligible CalHFA buyers can often close with little to no money out of pocket beyond earnest money and inspection fees. Eligibility tracks MyHome's first-time buyer, income, and purchase price limits, and the program is offered with CalHFA's conventional first mortgage products.
  • USDA Rural Development (USDA-RD) Loans in California. USDA Rural Development guaranteed and direct loans offer 100% financing (no down payment required) for primary residences in USDA-eligible areas. California's USDA-eligible footprint is much narrower than most states because of the state's large metro footprints, but meaningful portions of the Central Valley outside the immediate Sacramento, Stockton, Modesto, and Fresno metro cores qualify, along with much of the Sierra foothills, far Northern California, the Central Coast inland from the immediate coastal cities, and most of the eastern desert counties outside the Palm Springs and Coachella Valley cores. USDA Guaranteed loans require household income at or below 115% of area median income and a credit score generally of 640 or higher. CalHFA's first mortgage can be underwritten as USDA-RD, which lets the buyer keep CalHFA's pricing plus MyHome DPA while taking advantage of USDA's zero-down structure.

Income and Purchase Price Limits

CalHFA income and purchase price limits vary widely by county, with substantially higher limits in the Bay Area and Los Angeles counties reflecting California's housing costs. Income limits generally range from roughly $160,000 in lower-cost California counties to $300,000+ in San Francisco, San Mateo, Santa Clara, and Marin counties for 1-2 person households, with higher limits for 3+ person households and in targeted areas. Purchase price limits typically range from roughly $700,000 in lower-cost California counties to $1.5M+ in the Bay Area, again with meaningful variation by county. Dream For All uses its own first-time buyer and California residency tests in addition to standard CalHFA income and purchase price limits. The major city programs each maintain their own income limits (typically expressed as a percentage of AMI - 80% AMI is a common threshold for the deepest assistance tiers in LA, San Francisco, San Diego, Oakland, and Sacramento). USDA Guaranteed loans use a separate income limit (115% of area median income) that often allows higher household income than CalHFA's standalone limits in the same county. Always confirm current CalHFA and city program income and purchase price limits with a CalHFA-approved lender or at calhfa.ca.gov before assuming eligibility.

City Programs Worth Knowing

California's major cities run some of the largest down payment assistance programs in the country - reflecting California's housing costs and the structural reality that even with full CalHFA stacking, a standard down payment in San Francisco, Los Angeles, or San Diego can easily exceed $100,000. Most are deferred or shared-appreciation seconds due on sale or refinance rather than forgivable grants, and most run on funding cycles or lotteries.

  • Los Angeles Housing Department (LAHD) Affordable Homeownership Program. Up to $140,000 in down payment and closing cost assistance for income-qualified first-time buyers purchasing a primary residence inside City of Los Angeles limits. Structured as a deferred second mortgage due on sale or refinance, with multi-year continuous owner-occupancy requirements and HUD-approved homebuyer education required. Designed to stack with CalHFA's MyHome and Zero Interest Program. Funding cycles can exhaust mid-year and the program is regularly oversubscribed - confirm availability with LAHD and your CalHFA-approved lender before counting on it in your offer.
  • San Francisco MOHCD Down Payment Assistance Loan Program (DALP). Up to $375,000 in down payment assistance for income-qualified first-time buyers purchasing a primary residence inside City and County of San Francisco limits - the highest city-level assistance amount in the country outside of Washington D.C. Administered by the San Francisco Mayor's Office of Housing and Community Development (MOHCD) and structured as a deferred shared-appreciation second mortgage: the borrower repays the original principal plus a proportional share of the home's appreciation when the home is sold, refinanced, or no longer the primary residence. Multi-year continuous owner-occupancy requirements, HUD-approved homebuyer education required, and designed to stack with CalHFA financing. The $375,000 ceiling reflects San Francisco's unique pricing and the city's policy commitment to keeping middle-income workers in the city; funding is allocated on a lottery basis in most cycles because demand vastly exceeds supply.
  • City of San Diego Affordable For Sale Housing Program. Up to $100,000 in down payment assistance for income-qualified first-time buyers purchasing a primary residence inside City of San Diego limits, administered through the San Diego Housing Commission. Structured as a deferred second mortgage due on sale or refinance, with multi-year continuous owner-occupancy requirements and HUD-approved homebuyer education required. Some assistance tiers are tied to specific deed-restricted affordable units rather than open-market purchases - ask the San Diego Housing Commission and your CalHFA-approved lender which tier fits your purchase. Designed to stack with CalHFA MyHome and ZIP.
  • Oakland Homebuyer Assistance Program. Up to $50,000 in down payment and closing cost assistance for income-qualified low- to moderate-income first-time buyers purchasing a primary residence inside City of Oakland limits. Structured as a deferred second mortgage due on sale or refinance, with multi-year continuous owner-occupancy requirements and HUD-approved homebuyer education required. Designed to stack with CalHFA's MyHome and Zero Interest Program. Confirm current funding availability with the City of Oakland's Housing and Community Development Department before applying.
  • Sacramento Housing and Redevelopment Agency (SHRA) Down Payment Assistance. Up to $22,000 in down payment and closing cost assistance for income-qualified first-time buyers purchasing a primary residence inside City of Sacramento or unincorporated Sacramento County jurisdictions served by SHRA. Structured as a deferred second mortgage due on sale or refinance, with multi-year continuous owner-occupancy requirements and HUD-approved homebuyer education required. Designed to stack with CalHFA MyHome and ZIP. Funding cycles can exhaust mid-year - confirm availability with SHRA before applying.

All of these city programs run on funding cycles or lotteries that can exhaust mid-year, and homebuyer education must be completed before application - not after offer acceptance. The city agency review step extends closing timelines by several weeks beyond a standard CalHFA-only closing; San Francisco DALP in particular can add substantial timeline because of the lottery, ranking, and underwriting steps. Plan that into the front of your timeline and confirm current funding availability and lottery status with the administering agency before counting on it in your offer.

FHA Loan Requirements in California

FHA loans are widely used by California first-time buyers and are compatible with CalHFA MyHome and the city DPA programs in Los Angeles, San Francisco, San Diego, Oakland, and Sacramento. CalHFA's conventional HFA Preferred product (used with ZIP and Dream For All in many cases) is not FHA but offers reduced PMI for credit-qualified buyers. California FHA loan limits are substantially elevated in the high-cost Bay Area and Los Angeles metros and use the standard single-family ceiling in lower-cost inland counties.

Minimum requirements to qualify for an FHA loan in California:

  • Credit score: 580 or higher for 3.5% down payment with standard FHA. CalHFA programs typically require 640-660 or higher; Dream For All has historically required 660+.
  • Down payment: 3.5% of the purchase price with a 580+ credit score. CalHFA MyHome (up to 3.5% of the loan amount) plus ZIP (closing costs) can fully cover this and most closing costs at the statewide level; in the major cities, layering a city DPA program on top can cover the entire down payment even on high-priced California homes.
  • Debt-to-income ratio (DTI): Generally 45% or below for CalHFA (FHA itself allows up to 50% with compensating factors).
  • Employment history: Two years of consistent employment or verifiable income history.
  • Primary residence: FHA loans require owner occupancy - not eligible for investment properties or vacation homes, which matters in California because a meaningful share of available inventory in the coastal markets is held as second homes or short-term rentals.
  • Mortgage insurance: FHA loans require an upfront mortgage insurance premium (UFMIP) of 1.75% of the loan amount, plus an annual premium of 0.45% to 1.05%. Credit-qualified buyers should ask about CalHFA HFA Preferred conventional instead for reduced PMI.

USDA Rural Development loans in California:

USDA-RD is the better fit than FHA for California buyers whose target property sits in a USDA-eligible area - but California's USDA-eligible footprint is much narrower than most states because of the state's large metro footprints. Where USDA does apply, it requires no down payment (versus FHA's 3.5%) and has a lower annual mortgage insurance equivalent.

  • Property eligibility: Address must be in a USDA-designated rural or suburban area. In California this means most of the Central Valley outside the immediate Sacramento, Stockton, Modesto, and Fresno metro cores; much of the Sierra foothills; far Northern California; the Central Coast inland from the immediate coastal cities; and most of the eastern desert counties outside the Palm Springs and Coachella Valley cores. Check the USDA Rural Development eligibility map by address - the lines are tight in California and can run street by street.
  • Income limit: Household income at or below 115% of area median income for USDA Guaranteed loans; very-low and low-income tiers for USDA Direct loans.
  • Credit score: 640 or higher for USDA Guaranteed (most lenders); USDA Direct has more flexible credit underwriting.
  • Down payment: 0% required - USDA loans offer 100% financing of the appraised value.
  • Mortgage insurance equivalent: USDA charges a 1.0% upfront guarantee fee (financed into the loan) plus a 0.35% annual fee - lower than FHA's MIP in most scenarios.
  • Primary residence: USDA loans require owner occupancy as a primary residence.

When you pair USDA with CalHFA, the USDA first mortgage handles the zero-down structure and MyHome DPA can be redirected to cover closing costs, prepaid items, and cash reserves.

FHA loan limits in California for 2025:

FHA loan limits in California are tiered by county. High-cost counties in the Bay Area (San Francisco, San Mateo, Santa Clara, Marin, Alameda, Contra Costa) and Los Angeles, Orange, San Diego, and Ventura counties use substantially elevated limits well above the standard FHA single-family ceiling - in the highest-cost counties the FHA single-family limit exceeds $1.2M. Lower-cost inland counties use the standard FHA single-family limit of $524,225. USDA loans use the appraised value of the property as the effective limit rather than a county loan-limit ceiling. Confirm the current FHA limit for your target county at HUD.gov.

Stacking FHA, USDA, or conventional with CalHFA and city DPA programs:

The most efficient structure for a Los Angeles first-time buyer is an FHA-backed CalHFA first mortgage layered with MyHome (up to 3.5% of the loan amount), ZIP (closing costs), and the LAHD Affordable Homeownership Program (up to $140,000) - and where eligible, Dream For All on top for up to 20% of the purchase price as a shared-appreciation second. In San Francisco, the comparable stack is CalHFA + MyHome + ZIP + MOHCD DALP (up to $375,000) - the largest combined stack available anywhere in the country outside D.C. In San Diego the stack tops out around CalHFA + MyHome + ZIP + Affordable For Sale Housing Program ($100,000). In Oakland it's CalHFA + MyHome + ZIP + Oakland Homebuyer Assistance Program ($50,000). In Sacramento it's CalHFA + MyHome + ZIP + SHRA ($22,000). Credit-qualified buyers should compare CalHFA HFA Preferred conventional (reduced PMI) against an FHA-backed CalHFA loan side by side. Outside the major metros, USDA-RD + CalHFA is often the most efficient stack in the USDA-eligible parts of the state.

How to Apply

  1. Check your credit score - 580 is the FHA minimum for 3.5% down, CalHFA programs typically require 640-660 or higher, and Dream For All has historically required 660+.
  2. Review current CalHFA income and purchase price limits for your county at calhfa.ca.gov - California's limits vary substantially by county, with Bay Area and LA-area limits much higher than the rest of the state.
  3. Check whether Dream For All has an open application window and current funding - in recent cycles it has been operated on a lottery basis and has fully subscribed within hours. If Dream For All is closed, MyHome + ZIP is the always-on CalHFA stack to plan around.
  4. If you're buying inside City of Los Angeles limits, contact the Los Angeles Housing Department (LAHD) to confirm Affordable Homeownership Program eligibility and current funding - the program is regularly oversubscribed.
  5. If you're buying inside City and County of San Francisco limits, contact MOHCD to confirm DALP eligibility, current funding, and the lottery window - DALP is typically allocated by lottery and the timeline from lottery to closing is meaningfully longer than a standard CalHFA closing.
  6. If you're buying inside City of San Diego limits, contact the San Diego Housing Commission to confirm Affordable For Sale Housing Program eligibility and which tier fits your purchase.
  7. If you're buying inside City of Oakland limits, contact the City of Oakland's Housing and Community Development Department to confirm Oakland Homebuyer Assistance Program eligibility and current funding.
  8. If you're buying in the Sacramento Housing and Redevelopment Agency (SHRA) jurisdiction, contact SHRA to confirm Down Payment Assistance eligibility and current funding.
  9. Check the USDA Rural Development eligibility map by property address if you're considering a property outside the major metro cores - California's USDA-eligible footprint is narrow but real, and USDA + CalHFA is often the most efficient stack where it applies.
  10. Complete a HUD-approved homebuyer education course - required by CalHFA, Dream For All, and every major city program in California.
  11. Apply through a CalHFA-approved lender, who will coordinate the CalHFA application, MyHome and ZIP enrollment, Dream For All submission (if applicable), the USDA Guaranteed loan submission (if applicable), and any city DPA approval simultaneously.

FAQ

How does Dream For All actually work, and why is it a lottery?

Dream For All is a shared-appreciation second mortgage from CalHFA: it provides up to 20% of the purchase price toward your down payment, with no monthly payment and no traditional interest. When you sell or refinance, you repay the original principal plus a proportional share of the home's appreciation since closing. The lottery exists because demand vastly exceeds the legislative appropriation - in recent cycles the program has fully subscribed within hours of opening. If you're awarded a slot in the lottery you typically have a defined window to identify a property, write an offer, and close, which compresses the timeline significantly. If Dream For All isn't open or you don't win the lottery, MyHome + ZIP is the always-on CalHFA stack to plan around.

What's the difference between MyHome and ZIP?

They're complementary, not alternatives. MyHome is CalHFA's down payment assistance product - up to 3.5% of the loan amount as a deferred second mortgage, typically used to cover the down payment. ZIP is CalHFA's closing cost assistance product - a 0% interest deferred second specifically designed to cover closing costs and prepaid items (escrow setup, first-year homeowners insurance, prorated property taxes). They're meant to be used together: MyHome covers down payment, ZIP covers closing costs, and eligible CalHFA buyers can often close with little to no money out of pocket beyond earnest money and inspections.

How much assistance can I actually get in San Francisco, Los Angeles, or San Diego?

In San Francisco, an eligible first-time buyer can layer CalHFA MyHome + ZIP with the MOHCD Down Payment Assistance Loan (up to $375,000) for the largest combined city stack available anywhere in the country outside D.C. In Los Angeles, the stack is CalHFA MyHome + ZIP plus the LAHD Affordable Homeownership Program (up to $140,000), and where eligible Dream For All can layer on top for up to 20% of the purchase price as a shared-appreciation second. In San Diego, the stack is CalHFA MyHome + ZIP plus the Affordable For Sale Housing Program (up to $100,000). All three city programs are income restricted, structured as deferred or shared-appreciation seconds due on sale or refinance, and run on funding cycles or lotteries - confirm availability before counting on a specific dollar amount in your offer.

Is San Francisco's $375,000 DALP really a free $375,000?

No - DALP is a deferred shared-appreciation second mortgage, not a grant. You repay the original principal plus a proportional share of the home's appreciation when you sell, refinance, or stop using the home as your primary residence. It's still an extraordinarily powerful program because it carries no monthly payment and no traditional interest while you live in the home, but the city is taking an equity-style position in the upside of your home in exchange for that capital. Multi-year continuous owner-occupancy requirements apply, and DALP is typically allocated by lottery because demand vastly exceeds supply.

Is my California property eligible for a USDA loan?

California's USDA-eligible footprint is much narrower than most states because of the state's large metro footprints, but it's real. Most of the Central Valley outside the immediate Sacramento, Stockton, Modesto, and Fresno metro cores qualifies, along with much of the Sierra foothills, far Northern California, the Central Coast inland from the immediate coastal cities, and most of the eastern desert counties outside Palm Springs and the Coachella Valley cores. The only way to confirm is to check the USDA Rural Development eligibility map by your exact property address; eligibility is by address, not by ZIP code or city name, and the lines run tight in California - sometimes street by street at the edges of metros.

How long does it take to close using CalHFA plus a city DPA program?

Expect 45 to 90+ days depending on the city program and whether a lottery is involved. CalHFA-only closings track close to standard timelines (40-50 days). Adding LAHD, San Diego, Oakland, or Sacramento adds a city agency review step that extends closing by 20 to 40 days. San Francisco DALP can add substantially more because of the lottery, ranking, and underwriting steps - 60 to 120 days from lottery selection to closing is typical. Dream For All compresses the timeline differently: if you win the lottery you typically have a defined short window to identify a property, write an offer, and close. Homebuyer education should be completed before you start house hunting - not after offer acceptance - to avoid pushing the timeline further.