Buying A Home After College
You’re graduated from college or trade school, and ready to ditch your rental in favor of a property you can call your own. You’ve weighed your options and decided it’s time to invest in real estate ASAP. It’s likely you won’t have the cash needed to purchase the home out right and you’ll need to obtain a loan. Cover your basis and review the steps below to graduate from rental status into home ownership. Do you have what it takes to qualify?
Step 1 – Employment
Loan guidelines will accept two years of school transcripts in place of a two year work history as long as the education is in line with the job you’ve landed. Loans can close after you’ve received 30 days’ worth of pay-stubs.
Step 2 – Credit
Many college students have limited credit, but programs like FHA allow lower scores and alternative credit sources like cell phone, insurance, rent, and health club memberships. Learn about building credit in my understanding credit score article.
Step 3 – Funds
You just spent thousands on school and probably have limited savings; although you may be able to buy a home without much money at all. Down payment assistance programs like CALHFA, CHF Platinum, WISH, and County/City programs can bridge the gap for first time homebuyers without notable assets.
Updates to California Down Payment Assistance Programs
Stockton | Lodi | Elk Grove | Sacramento
The CHF Platinum Program has recently updated options for all qualifying homebuyers. The program now offers buyers an opportunity to expand grant funds up to 4%. Buyers are given an option to choose an interest rate to coincide with a grant amount. See example below
Check Current Rates
Changes like this will allow buyers an opportunity to avoid asking for seller paid costs and strengthen offers in this low inventory market. The CHF platinum program isn’t a first time homebuyer program and is open to all who qualify. Follow the link to read more about the CHF Platinum Program
In order to qualify for this program incomes must fall below the line of $85,680 in Stockton and $91,320 in Elk Grove.
First Time Homebuyer Programs
Most First Time Homebuyers have no idea that down payment assistance exists. In the Stockton, Lodi, Elk Grove, and Sacramento regions there is money available for those first time homebuyers who qualify. The down payment assistance programs offer help in the form of grants and silent seconds.
Grant programs provide buyers with money they don’t need to repay. It’s essentially a gift to help those who qualify. Depending on the program grants can vary in size and scope. Some cities and counties offer grants to those who need it the most, on a case by case basis. The most common grant program here in CA is the CHF Platinum program. The Platinum offers all owner occupied buyers the opportunity to qualify for a 3% grant.
A silent second is a 2nd loan taken out at the time of purchase, no payments are required until the end of the loan term. The loan interest charged varies greatly between programs, but most have a low fixed simple interest. Some programs will forgive interest or even the principle balance depending on how long the homebuyer live in the property. The programs used in this area include CALHFA, City of Stockton, City of Lodi, San Joaquin County, and City of Elk Grove.