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Best Housing Grants for Low-Income Buyers in California

A down payment and closing costs are the main reasons many people put their home-buying plans on hold. However, you shouldn’t let these costs stop you. California has housing grants and loans for low-income buyers.
A down payment and closing costs are the main reasons many people put their home-buying plans on hold. However, you shouldn’t let these costs stop you. California has housing grants and loans for low-income buyers.

Many hopeful home buyers put their plans on hold due to costs such as down payments, closing costs, homeowners insurance policies, mortgage payments, and other related costs. However, these costs shouldn’t stop you from buying your dream home. Believe it or not, you may be eligible for down payment and closing cost assistance to help buy your California home.

Don’t know what we’re talking about? We’ll tell you everything you need to know about the housing loans and grants you should consider as a low-income home buyer in California.

Best California Loans and Grants for Low-Income Home Buyers

Low-income home buyers in California can apply for loans and grants to help with the purchase of their dream house. These programs offer down payment and closing cost assistance if you meet their minimum requirements. But before applying, you should consider what’s holding you back from buying a home.

Maybe you can’t cover the closing costs on your home or don’t have enough saved for a down payment. Either way, an assistance program may provide the funding you need to close on your home.

MyHome Assistance Program

Under this program, qualified first-time home buyers may receive down payment or closing cost assistance when taking a CalHFA mortgage loan. The MyHome Assistance Program is limited to 3.5% of the appraised value or home purchase price, whichever is lower.

This funding is provided under a deferred payment subordinate loan, a top benefit of the program. Essentially, you won’t repay the money until you sell, refinance, or pay off your home. Keep in mind that you may also combine this assistance with other home buying assistance programs.

CalHFA Zero Interest Program

The CalHFA Zero Interest Program makes CalPLUS Conventional and CalPLUS FHA loans more affordable for home buyers. You may receive up to 4% of the loan amount to cover your closing-related costs.

The biggest advantage of this program is that you’ll borrow this amount as a 0% interest second loan, which you won’t have to repay as long as you live in the house. However, you’ll be required to pay it back if you refinance, sell, transfer the property title, or default on the loan.

Cal-EEM + Grant Program

The Cal-EEM + Grant Program helps first-time and repeat low-income home buyers make energy efficient improvements higher than the amount allowed by FHA. Under this program, you’ll be eligible for a grant of up to 4% of the loan amount.

You’ll be eligible for a 30-year fixed rate FHA-insured mortgage loan under this assistance program. The top benefit of this program is that you’ll be able to make better energy-efficient improvements to your home while obtaining the benefits of an FHA mortgage.

These programs are just some of the down payment and closing cost assistance provided by the state of California. Before applying you should do your homework and learn everything you can about the low-income loan programs available in your area.

Best Federal Mortgage Options for Low-Income Buyers

California loans and grants programs aren’t the only options available for home buyers in this state. The government offers federal mortgage options for low-income or low credit score borrowers.

VA Loans

The VA loan program is available for active and retired members of the military. The biggest advantage of this program is that it doesn’t require a down payment or mortgage insurance to close on your home.

FHA Home Loan Program

The FHA loan program offers options for low-income buyers with a less-than-perfect credit score. If your score is over 580, you can close on a home with a down payment of only 3.5%. Borrowers with credit scores between 500 and 579 may be eligible for an FHA loan with a 10% down payment.


When it comes to federal programs, you may be eligible for other programs based on your location. You should also keep in mind that your FHA loan options may vary on a state basis.

Learn More: The Complete Guide to FHA Loans By State

Best Private Lender Programs in California for Low-Income Home Buyers

Besides federal and state-sponsored loan programs, you may consider taking advantage of private lender programs. You can apply for Fannie Mae’s HomeReady or Freddie Mac’s HomeOne mortgage programs.

Both programs require only a 3% down payment, lower than FHA’s 3.5% requirement. These programs also require borrowers to complete a home buying educational requirement.

Fannie Mae’s HomeReady program is available only for low and moderate-income home buyers. Their minimum credit score requirement is 620 or more. However, you may be eligible for better rates if your score is over 680.

Freddie Mac’s HomeOne mortgage program is available for home purchases and no cash-out refinances. This program doesn’t impose income limits on borrowers. This financing option is only available for single family homes including condos and townhomes.

While most private lenders offer these financing options, you should do your homework and search for the best mortgage lenders to obtain the lowest rates on your home purchase financing.

Home Buyer Rebate

While researching your home financing options is a must, you should also consider consulting with a local real estate agent. An expert can provide insight into your financing options and guidance throughout your home buying process. An experienced realtor can recommend strategies for lowering your home buying costs like negotiating with sellers and timing the market.

When you choose to work with a Clever Partner Agent, your realtor will give you a $1,000 rebate from their commission fees to cover your closing costs or as mortgage points in qualifying home purchases. You’ll also obtain the best home buying guidance while saving on closing costs through our home buyer rebate program.


Andrew Schmeerbauch

Andrew Schmeerbauch is the Director of Marketing at Clever Real Estate, the free online service that connects you top agents to save on commission. His focus is educating home buyers and sellers on navigating the complex world of real estate with confidence and ease. Andrew has worked on projects for the United Nations and USC and has a particular passion for investing and finance. Andrew's writing has been featured in Mashvisor, L&T, Ideal REI, and Rentometer.

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