One of the biggest myths stopping renters from becoming homeowners in California is the belief that you need 20% down to buy a house. You don’t. In fact, there are programs specifically designed to lend or give you part — or even all — of your down payment. And California has some of the best in the country.

If you’ve been waiting on the sidelines because you haven’t saved enough to buy, here’s what you need to know.

What Is Down Payment Assistance?

Down payment assistance (DPA) refers to programs — offered by state agencies, local governments, and lenders — that help homebuyers cover the upfront cost of purchasing a home. That assistance typically comes in one of three forms:

  • A deferred loan — you borrow the down payment and repay it when you sell, refinance, or pay off your mortgage. No monthly payments in the meantime.
  • A low-interest loan — similar to a deferred loan, but with a small interest rate attached.
  • A shared appreciation loan — the program covers part of your down payment, and in return receives a share of your home’s appreciation when you sell.

All three can dramatically reduce what you need to bring to the table on closing day.

California’s Major DPA Programs

CalHFA MyHome Assistance Program

The California Housing Finance Agency’s MyHome program is one of the most widely used DPA options in the state. It provides a deferred-payment second mortgage — meaning no monthly payments — of up to 3.5% of the purchase price for FHA loans, or up to 3% for conventional loans.

On a $500,000 home, that’s up to $17,500 toward your down payment or closing costs, with nothing due until you sell or refinance. It can be paired with several of CalHFA’s first mortgage products and stacked with other assistance programs for even more coverage.

Who it’s for: First-time buyers in California using a CalHFA-approved lender. Requires completion of a homebuyer education course and meets CalHFA income limits for your county.

California Dream For All — Shared Appreciation Loan

California’s Dream For All program provides up to 20% of the purchase price as a shared appreciation loan for the down payment [Mortgage-info] — capped at $150,000. No monthly payments are required. When you sell, refinance, or transfer the home, you repay the original amount plus 20% of any home value appreciation. [Mortgage-info]

Dream For All opens in funding waves, typically two to three times per year, and previous rounds have sold out in hours to days. [Mortgage-info] If you’re interested in this program, the best move is to get your pre-approval done now and sign up for CalHFA alerts so you’re ready when the next round opens.

Who it’s for: First-generation homebuyers — meaning at least one borrower must not have been on a property title in the US in the last seven years, and the borrower’s parents must not presently hold title in the US. [City of Berkeley] Income limits apply by county.

Lender-Based DPA Programs

Beyond state programs, many mortgage lenders offer their own down payment assistance options that work independently of CalHFA. These can be especially useful for buyers who don’t qualify for state programs due to income limits or first-time buyer restrictions.

At Golden Bear Mortgage, we offer a down payment assistance program that lends the down payment to the buyer at just 1% interest. For someone with solid income and good credit who simply hasn’t had the chance to save up a full down payment — this can be the difference between renting and owning.

These types of programs often have more flexible eligibility than government programs and can move faster since they don’t depend on state funding availability.

Can You Stack Multiple Programs?

Yes — and it’s more common than most buyers realize. Many California homebuyers combine a state program like CalHFA MyHome with a local city or county program to cover both their down payment and closing costs together. Some combinations, when structured correctly, can eliminate nearly all upfront out-of-pocket costs. A knowledgeable loan officer can identify which programs you qualify for and how to layer them for maximum benefit.

What Do You Actually Need to Qualify?

Requirements vary by program, but here’s what most DPA programs look for:

  • Credit score: Most CalHFA programs require a minimum 660–680. Lender-based programs may be more flexible.
  • Income limits: State programs set income limits by county. Limits are higher in expensive markets like the Bay Area and lower in more affordable areas.
  • First-time buyer status: Many programs define “first-time buyer” as not having owned a home in the past three years — so previous homeowners may still qualify.
  • Homebuyer education: CalHFA requires homebuyer education and counseling for first-time homebuyers using a CalHFA program. [CA]
  • Primary residence: All DPA programs require the home to be your primary residence — investment properties don’t qualify.

The Bottom Line

The down payment is the single biggest barrier keeping renters out of the housing market in California. But with the right programs and the right lender, it doesn’t have to be yours.

If you’ve been putting off buying because you’re not sure what you can actually afford to put down — the first step is a conversation. We can tell you which programs you qualify for, what your options look like, and what the real number is that you need to get into a home.

Ready to find out what’s available for you? Contact Golden Bear Mortgage today at (916) 761-2327 or visit www.gbmc.com.

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