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First-Time Homebuyer Program

February 20, 2012

The First-Time Homebuyer Program (FTHB) is designed to help low-income homebuyers by providing financial assistance for down payment and closing costs on home purchases within the City and County of Sacramento.

Program Features
  • deferred payment loan secured by a deed of trust
  • assistance is calculated at 20 percent of the purchase price to a maximum of $40,000
  • “Limited” FTHB assistance – when used in conjunction with special sales programs, the assistance is limited to 10 percent of the purchase price to a maximum of $20,000
  • 3% simple interest – principal and interest are deferred for the term of the loan
  • thirty (30) year loan term, or due upon sale or transfer of the property; refinancing may be allowed subject to Agency subordination policy
  • first mortgage may be FHA insured, conventional, or CalHFA financing. Please refer to Agency Homeownership Guidelines for first mortgage restrictions.
  • funds may be used to reduce the amount of the first mortgage, including 50 percent of the down payment that is required by the first mortgage loan program, and to pay the buyer’s customary closing costs
Eligible Applicants
Homebuyers who
  • are first-time homebuyers (have not owned a home within the preceding three years, or meet the definition of a displaced homemaker or a single parent)
  • are able to qualify for a loan to purchase the home
  • will have a monthly housing debt ratio of not less than 28% and not more than 35% of gross monthly income (up to 40% may be allowed with compensating factors)
  • attend homebuyer education classes
  • will live in the home being purchased
  • are defined as low-income – households with income less than or equal to eighty percent (80%) of the area median income adjusted for household size. Current income limits are:
Eligible Properties
Single family homes that are located within the City or County of Sacramento. The program is not available in Citrus Heights and Elk Grove. The program may be available in Rancho Cordova, subject to the HOME consortium.
  • property must meet minimum housing quality standards – an Agency inspection will be required. Properties built prior to 1978 are subject to the Lead-Based Paint regulations.
  • appraised value may not exceed the HUD 203(b) mortgage limit for the area, currently $580,000.
  • properties that are tenant-occupied as of the date of the purchase offer are not eligible
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