Real Estate

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Introduction

One of the challenges that have remained an obstacle of the fist time home buyer is to know how to start the purchasing process. Most of them have not made the decision where they are going to purchase their house. Other has not saved enough money to enable them to meet the down payment and the closing costs of the e potential homes. Most of the first time home buyer usually rent a house or they are accommodated by their parents or they fires. They are usually faced with a lot of constrain in meeting the down payment unlike those who own houses and are considering purchasing there second or consequential house. However the federal and the state government recognize this need and they usually come up with programs which are usually aimed at helping the first time home buyers to own homes easily.

First home buyer programs in California

The state of California has realized that first home buyers need to be assisted in order to be able to acquire houses like the rest of the population. The state has come with outright grants which are aimed at assisting the first time homebuyers to meet the down payment for their homes. There are also aimed at helping first time home buyers who meet certain qualification access closing cost for their prospective new home. (Homeownership, 2008)

Besides giving grants to the home buyers, the state has also come up with additional first time home buyer program which offered flexibility in the purchasing process. There are several programs which are found in different counties and cities in California which offer flexible conditions for the first time home buyers which are totally different from those who are buying their second and consequential houses. These programs are primarily based on various or other which offer low interest mortgage loans, and other spice it up with educational seminars. These programs make is easy for the first time home buyers to afford mortgages which they would not have afforded in the conventional way.

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California offers only one designed first time home buyer program which apparently covers all those who are purchasing their first house in the state. The state has come up with a legislation that supported the creation of a program which assists the first time home buyer to purchase their houses. This program which has been created by government legislation is California Housing Finance Agency. There are other programs which usually run under this large program. The following is just summary of how the programs are conducted;

There is CHDAP which usually offers the down payment to all the fist time home buyers. As we have listed above, meeting the down payment cost is perhaps the most challenging part for all the first time home buyers. However this is offered to only some homebuyer who meets the specified qualification.

CHDAP offers deferred-payment junior loan which is up to t3 percent of the purchase price of the home or the appraised value of the property. This is usually less and is offered to the qualified borrowers to be used as the nonpayment for the home or the closing cost for the home. This junior loan program is sometimes combined with the CAlHFA or the non CalHFA first item mortgage loan. Therefore it ends up increasing the resources for the first time home buyer. However it cannot be combined with the Extra Credit Teacher Program (ECTP) or any Homeownership in Revitalization Areas Program (HIRAP). This program has remained to be one of the most effective ways to ensure that the first time home buyer to afford buying purchasing houses. (Best Syndicate, 2006)

There are many lenders who don’t recognize the need to offer loans to first time buyers. This is because most of them do no have s record of credit worthiness and they fear defaulting of the loans. Therefore they only provide loans to those who have proven a record of repaying mortgage. This program advices the first time home buyer to seek down payment assistance loan program from institutions like Affordable Housing Partnership Program (AHPP), CalHFA Housing Assistance Program (CHAP), California Homebuyer Downpaymet Assistance Program (CHDAP), Extra Credit Teach Home Purchase Program (ECTP), High Cost Area Home Purchase Assistance Program (HiCAP), School Facility fee Down Payment assistance Program

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(SFF), and many other which are likely to offer flexible payment programs for home owners. There are also other program which this program partners which in provision of housing assistance toe the first time home buyers. These programs include HomeOpeners which is a mortgage protection program and it assists them to pay their mortgage in event of an involuntary job loss. It offered as a part of primary mortgages insurance at no extra cost. There is also Home Choice Program Information which is a statewide program assisting low and the moderate income borrower who have a disability or who have family members who are disabled and who live with them to acquire their fist home. HUD is a section 8 Housing Choice Voucher Program which enables the qualified first-time homebuyers to get monthly help in order to cater for homeownership cost which is in lieu of the monthly rent aid. (California First Time Home Buyers Program, 2008)

Conclusion

These are some of the programs which have been put in place in order to assist the first time home owners in the state to have an easy access to home ownership. This has been an important initiative by the government to ensure that first time home owners have an easy access to loans for buying houses

References

Best Syndicate, (2006): California first tiem hoem buyer program offer zero down payment. Retrieved from http://www.bestsyndicate.com

California First Time Home Buyers Program, Retrieved from http://www.firstimehomebuyercent

r.com/                                                                                                                                                  on 25th July 2008

First Time Home buyer Grant in California, (2008): Retrieved from http://first-time-home-buyers

-s.com/first_tim_home_buyer_grant_call.htm

on 25th July 2008

Homeownership (2008): Home buyer Program sorted by city. Retrieved from, http://www.hud.g

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ov/local/ca/homewnership/program.htm

on 25