CalHFA Extra Credit Teacher Home Purchase Program
One of the best but underused programs is the Extra Credit Teacher Home Purchase Program. The incentives this program provides are the greater of 3% or $7500 in non-high cost counties and $15,000 in high cost counties.
Notice the word greater, if the 3% is greater than $7500 that will be what you get. The amount you receive will be deferred for the life of the first mortgage. This program also must be combined with a CalHFA first mortgage but cannot be combined with CHDAP.
This program is only available for teachers and/or staff of the school (yes that means the janitor as well) and the school must have an API ranking between 1-5. If you’re a teacher working at a Special Ed or Continuation school or Charter schools will automatically qualify you for this program as long as you meet the other requirements.
The wonderful part about this program is that you can combine it with the CalHFA CalPlus with Zip or Zip Extra to provide additional incentives. In the past I have closed a transaction where the employee of the school was able to close and actually get 25.00 back at closing!
One big thing to remember with this program is that you must continue to work at the school for a period of 3 years to have the interest fully written off. The interest will be reduced 1% per year until you either leave your employment or it’s been 3 years. If the teacher moves into a school with a higher ranking, the interest will be charged.
Now that we’ve talked about the just of the program, let’s do a quick recap.
Eligible School Employees:
· Teachers – must be have full credential
· Classified Employees
· Staff Members (Coach, Janitor…etc)
Important Bullet Points:
· Commitment to work 3 years in high priority schools with an API rank of 1-5
· Must be a first-time homebuyer (have not purchased a home in the past 3 years)
· Greater of 3% of $7500 in non-high cost areas
· Greater of 3% of $15,000 in non-high cost areas
· Do not have to buy a home in the school district
· 3% simple interest that will be forgiven to 0% after 3 years employed
· Deferred for the life of the first mortgage (will need to be repaid once refinanced or sold)
· Has to be combined with a CalHFA first mortgage
· Special Education, Continuation or Charter schools auto qualify
· If school has no ranking and 70% of the kids qualify for free or reduced lunch you can qualify
These are the most important aspects of this program and it is not an easy transaction, you want to work with a qualified professional that is educated with this program. It is only for California home purchases, other states & counties have programs that can be very similar to this.
If you have any questions or would like to contact me directly to apply please reach out to myself or my staff at 619-379-8999 or [email protected]
Hi, my name is Erik Sandstrom. I’m a proud sponsor and mortgage expert on LoanSafe.org. I’m also a sale’s manager and loan officer with Caliber Home Loans. If you are looking for a great mortgage with the best rates or for a great company to work for, please give me a call at 619-379-8999