California Housing Finance Agency Suspends Programs / Down Payment Assistance

September 23rd, 2008 – In a shocking move today CalHFA temporarily suspends most of thier first time home buyer programs leaving only the 30 year fixed and the Extra Credit Teacher Program:

Effective immediately and until the financial markets stabilize, the following CalHFA first

mortgage products are temporarily unavailable:

• 35-Year Fixed Rate Mortgage – interest only PLUSSM

• 40-Year Fixed Rate Mortgage

• HomeChoice Program

• New BLOCK Forward Commitments will not be issued, including forward commitments

for the Self-Help Builder Assistance Program (SHBAP)

Additionally the following subordinate loan programs are also temporarily unavailable:

• High Cost Area Home Purchase Assistance Program (HiCAP)

• CalHFA Housing Assistance Program (CHAP)

Effective September 23, 2008, the interest rate on all 30-Year Fixed Mortgages will be 6.750%.

This situation is being monitored daily and these rates and loan products are under continual

review. When conditions warrant, programs will be reinstated, announced by Program Bulletin

and posted on CalHFA’s website.

The attached interest rates are applicable to all loan reservations received by the Agency after

12:01 a.m. on September 23, 2008.

We fully expect that this is an extremely temporary move by CalHFA until the Federal Bail out plan is figured out. CalHFA was recently funded and has no shortage of funds to lend as the program has recently recieved it new funding in August of this year.

The anticipation of the federal bail out is sweeping and has the potential to change how all mortgages are written in the future. It is a little scary that CalHFA seems that there is little confidence in the federal government to get this resolved quickly and in a way that protects would protect thier current menu of first time home buyer products and down payment assistance programs.

Stay tuned as we will continue to keep an eye on the progress of the fed bail out and keep you informed of this move by CalHFA as well as other specialty community programs. For questions, call 1-866-667-6724 or join us for one of our informative Webinars as we discuss all of the latest news that is important for home buyers in this volatile market.

If you have questions about this or any other down payment assistance programs that may be available in your area call us at 1-866-667-6724 or Click Here if you would like us to research programs you may qualify for.

For a complete list of upcoming no-cost on-line home buyer classes, follow this link – Upcoming First Time Homebuyer Classes