First-time home buyer California programs: the short answer
A first-time home buyer in California can combine a low-down-payment first mortgage with state help toward the down payment and closing costs. The state housing finance agency, CalHFA, is the main source. Its two best-known programs work like this as of October 2026:
- MyHome Assistance Program: a deferred-payment second loan of up to 3.5% of the price or appraised value (whichever is less) with a CalHFA FHA loan, or up to 3% with a CalHFA conventional, VA or USDA loan. You make no payments until you sell, refinance, transfer title or pay off the first loan.
- California Dream For All: a shared appreciation loan of up to 20% of the price, capped at $150,000, for first-generation buyers. The 2026 application portal closed on March 16, 2026, and vouchers go out by random drawing.
To put those numbers in context, Zillow's typical California home value was $761,538 in September 2026. On that price, a 3.5% FHA down payment is $26,654, and MyHome could cover up to the same $26,654. Dream For All's 20% would be $152,308, so the $150,000 cap would apply. See average home prices in California and the California data page for county figures.
Who counts as a first-time home buyer in California
CalHFA's first-time homebuyer definition: three years without ownership
CalHFA defines a first-time homebuyer as someone who has not had an ownership interest in any principal residence, or lived in a home owned by a spouse, during the previous three years. So you can have owned a home before and still qualify, as long as that ownership ended more than three years ago. For MyHome, every borrower, including co-borrowers, must meet this definition and live in the home.
Exceptions to the first-time rule: disaster victims and HUD 184
The MyHome handbook lists two exceptions. Borrowers using HUD's Section 184 Indian Home Loan Guarantee program are exempt from the first-time requirement. So are borrowers using FHA Section 203(h) whose previous primary residence was destroyed or declared uninhabitable in a federally declared major disaster in California; they can buy with CalHFA programs within one year of the disaster declaration.
Occupancy and citizenship rules for CalHFA loans
You must move in as your primary residence within 60 days of closing. Non-occupant co-borrowers and non-occupant co-signers are not allowed, so a parent who will not live in the home cannot sign the loan to help you qualify for MyHome. Each borrower must be a U.S. citizen, a U.S. national or a "qualified alien" as defined in federal law (8 U.S.C. 1641).
First-generation buyer rule for Dream For All
Dream For All adds a stricter test: all borrowers must be first-time buyers, and at least one must be a first-generation homebuyer, meaning their parents did not own a home under the program's definition. The application asks for both parents' names, dates of birth and addresses, plus proof of the relationship. At least one borrower must be a current California resident.
CalHFA programs for first-time buyers in 2026
CalHFA first mortgages: FHA, conventional, VA and USDA
CalHFA does not lend directly. Its loans are made through CalHFA-approved lenders, and every program is a 30-year fixed-rate loan: CalHFA FHA (insured by FHA), CalHFA Conventional (with private mortgage insurance), CalHFA VA and CalHFA USDA. CalHFA's matrices, updated January 1, 2026, set these minimums:
| CalHFA first mortgage | Minimum credit score | Maximum debt-to-income | Maximum loan-to-value / combined |
|---|---|---|---|
| CalHFA FHA (automated approval) | 640 (700 for DTI over 45%) | 45% (50% with 700 score) | 96.5% / 105% |
| CalHFA FHA (manual underwriting) | 660 | 43% | 96.5% / 105% |
| CalHFA Conventional | 680 (700 for DTI over 45%) | 45% (50% with 700 score) | 97% / 105% |
FHA loans follow FHA county loan limits. Conventional loans follow conforming limits, and CalHFA treats any loan above $832,750 as high balance, with an extra fee and a 95% cap for conventional loans. CalHFA also requires a one-year home warranty when a first-time buyer purchases a resale home.
MyHome Assistance Program: up to 3.5% for the down payment
MyHome is a deferred-payment, simple-interest second loan that can only be used with a CalHFA first mortgage. It can pay the down payment, closing costs or both, but cannot pay off debts or give you cash back. Payments are deferred for the life of the first loan, and the full balance plus interest is due when you sell, transfer title, refinance or pay off the first loan, or if a notice of default is recorded. The combined loan-to-value cannot exceed 105%, and the lender's processing fee for MyHome is capped at $250. MyHome can be layered with other down payment programs, but it must sit in second position.
California Dream For All shared appreciation loan
Dream For All pays up to 20% of the purchase price, to a maximum of $150,000, toward the down payment and closing costs. You make no monthly payments. When you sell, transfer the home or pay off the first mortgage, you repay the original amount plus 20% of the home's appreciation. Borrowers at or below 80% of area median income pay a reduced 15% share. It must be used with CalHFA's Dream For All Conventional first mortgage.
CalPLUS and the Zero Interest Program for closing costs
CalPLUS FHA and CalPLUS Conventional carry a slightly higher rate than CalHFA's standard loans but come with the Zero Interest Program (ZIP), a second loan of 2% or 3% of the first mortgage that can only pay closing costs and prepaid items. CalPLUS Access pairs with MyAccess, worth 2.5% of the first mortgage, for down payment and closing costs.
California first-time home buyer income limits for 2026
CalHFA caps household income by county. The 2026 limits took effect for reservations on or after June 30, 2026, and use the income your lender counts to qualify you. Dream For All has its own, lower table. Selected counties:
| County | CalHFA first mortgage and MyHome limit | Dream For All limit |
|---|---|---|
| Los Angeles | $214,000 | $171,000 |
| Orange | $274,000 | $219,000 |
| San Diego | $259,000 | $207,000 |
| Riverside | $210,000 | $168,000 |
| San Bernardino | $210,000 | $168,000 |
| Sacramento | $245,000 | $196,000 |
| Santa Clara | $325,000 | $310,000 |
| Contra Costa | $322,000 | $257,000 |
| Ventura | $268,000 | $214,000 |
| Kern | $192,000 | $153,000 |
| Fresno | $192,000 | $153,000 |
The lowest limit in the state is $192,000 for CalHFA loans and $153,000 for Dream For All; the highest is $325,000 for CalHFA loans (Marin, Napa, San Francisco, San Mateo and Santa Clara) and $310,000 for Dream For All (Marin, San Francisco, San Mateo and Santa Clara). Check CalHFA's full county PDFs before you apply, because the limits change each year.
FHA, VA and CalVet loans for California first-time buyers
FHA loans: 3.5% down with flexible rules
FHA insures loans made by approved lenders; it does not lend. HUD says FHA down payments can be as low as 3.5%, loan limits vary by county so buyers in high-cost areas can still use FHA, and non-occupant co-borrowers such as a parent are allowed on a standard FHA loan. That last point differs from CalHFA, which bans non-occupant co-borrowers on its own loans. FHA loans carry mortgage insurance premiums; ask your lender for the current upfront and annual rates.
VA loans: no down payment for eligible service members and veterans
The U.S. Department of Veterans Affairs says a VA-backed purchase loan needs no down payment as long as the price does not exceed the appraised value, and there is no private mortgage insurance. Most borrowers pay a one-time VA funding fee. You need a Certificate of Eligibility, must meet VA and lender credit and income standards, and must live in the home. CalHFA VA pairs a VA loan with MyHome at up to 3%.
CalVet home loans for California veterans
The California Department of Veterans Affairs runs its own CalVet Home Loan program, separate from the federal VA loan. Its terms, eligibility and current rates are set by CalVet, so check calvet.ca.gov or call CalVet before comparing it with a VA or CalHFA loan.
Local first-time buyer programs in California counties and cities
Many California counties and cities run their own down payment assistance, usually funded by federal HOME or CDBG grants or local housing trust funds. They are typically deferred second loans, often with lower income limits than CalHFA and a cap on the purchase price, and some require you to live or work in that city. Funding opens and closes during the year, so a program that was full in spring may reopen later.
How to find local assistance where you are buying
- Search the city and county housing department pages for "down payment assistance" or "first-time homebuyer program".
- Ask a HUD-approved housing counseling agency; HUD lists them at hud.gov/counseling or (800) 569-4287.
- Ask CalHFA-approved lenders which local programs they can layer with MyHome. CalHFA allows layering as long as MyHome stays in second lien position.
Local programs often require their own homebuyer class, resale restrictions or repayment if you move out early. Read the deed restrictions before you count the money.
Steps to buy your first home in California
Step 1: Check your credit score and debt-to-income ratio
Pull your credit reports and compare your score with the minimums above: 640 for CalHFA FHA, 680 for CalHFA conventional. Add up your monthly debts, including the new housing payment, and divide by gross monthly income to estimate your debt-to-income ratio.
Step 2: Take the CalHFA homebuyer education course
CalHFA requires homebuyer education for at least one occupying first-time borrower. The only online course it accepts is eHome's eight-hour course, which costs $100; other online courses such as Frameworks are not accepted. Live counseling through NeighborWorks America or any HUD-approved housing counseling agency also counts. Dream For All buyers should also take the free one-hour Dream For All course.
Step 3: Get preapproved with a CalHFA-approved lender
Only CalHFA-approved lenders can make CalHFA loans, and mortgage brokers must go through an approved wholesale lender. Ask for a preapproval that names the exact first mortgage and assistance programs, and confirm your income against the county limit.
Step 4: Shop for a home and make an offer
Work out your maximum price from the preapproval, not from what the lender will stretch to. Ask your lender how any seller credit toward closing costs would fit the loan rules before you write it into an offer. Our guide to buying a house in California covers offers and contingencies.
Step 5: Review disclosures, inspection and appraisal
Read the seller's disclosures, order a home inspection and check the property's fire hazard zone and insurance cost before your contingencies end. Our seller disclosure guide, fire zone guide and homeowners insurance guide explain each check. If the appraisal comes in low, MyHome is based on the lower of price or appraised value.
Step 6: Close, move in and file the homeowners' exemption
Move in within 60 days of closing to meet CalHFA's occupancy rule. Then file the homeowners' exemption with the county assessor: it cuts $7,000 from your assessed value, and the Board of Equalization says it typically saves about $70 a year. File by February 15 for the full exemption.
Costs first-time buyers should budget in California
Down payment and mortgage insurance costs
FHA's minimum is 3.5% and CalHFA conventional allows 97% loan-to-value (3% down). Both carry mortgage insurance, which adds to the monthly payment. MyHome or Dream For All can cover part or all of the down payment.
Closing costs, transfer tax and lender fees
Expect lender fees, title and escrow fees, prepaid interest, insurance and property tax impounds. CalHFA caps the lender origination fee on its first mortgages at 3% of the loan or $3,000, whichever is greater. Who pays the documentary transfer tax depends on local custom and your contract. See California closing costs and California transfer tax.
Property tax and the supplemental tax bill
Your purchase resets the assessed value to the price you paid, and the county sends one or two supplemental tax bills that are not paid from your impound account. Budget for them. Our California property tax guide works through a full bill, and new-construction buyers should read the Mello-Roos guide.
Worked example: a first-time buyer in Riverside County
This is an illustration, not a quote. Assume a buyer with a 660 credit score buys at Zillow's typical Riverside County home value of $602,790 (September 2026) with a CalHFA FHA loan and MyHome. Household income is $150,000, below Riverside County's $210,000 CalHFA limit.
- FHA minimum down payment (3.5%): $602,790 x 0.035 = $21,098.
- FHA first mortgage (96.5%): $602,790 - $21,098 = $581,692 (before any financed FHA premium).
- MyHome maximum (3.5% with FHA): $602,790 x 0.035 = $21,098, which can cover the down payment.
- Combined loan-to-value: ($581,692 + $21,098) / $602,790 = 100%, inside CalHFA's 105% combined limit, which leaves up to 5% for other approved assistance toward closing costs.
The buyer still pays closing costs not covered by assistance, the $100 education course if taken online, and the home warranty CalHFA requires on resale purchases. MyHome's $21,098 plus interest is repaid when the home is sold or refinanced.
Common mistakes California first-time buyers make
- Taking the wrong education course. CalHFA accepts only eHome online or live HUD-approved counseling.
- Planning on a non-occupant co-signer. CalHFA does not allow one; standard FHA does.
- Counting on Dream For All without a voucher. It is a lottery, and the 2026 portal closed March 16, 2026.
- Forgetting the repayment. MyHome is a loan, due at sale or refinance, and Dream For All takes a share of appreciation.
- Missing the homeowners' exemption. It is a one-time filing, but you must make it.
- Ignoring supplemental property tax bills. They are sent to you, not your lender.