Cash is King – Upside Down Mortgage Solutions

California No Money Down FHA and CalFHA Loans for Home Buyers in a Declining Market

A couple of years ago you could get declined for a Discover card but you could qualify for a home loan. Think for a moment about the logic because I am not exaggerating. There were hundreds of thousands of people that got into loans that they were not qualified to handle thanks to stated income mortgage, thus developing the onslaught of foreclosures and Short Sales that have come to pass. The rules of the game have changed and the difference now is that people will have to qualify and in some cases over qualify for financing. Lenders and consumers both have taken massive losses and new policy and laws have been set into motion to make sure that we never end up in a similar situation.

There are numerous reasons to learn more about 100% financing besides that fact that about 90% of it completely disappeared. For instance, you could be a first time home buyer or know someone who is looking, that could benefit from this knowledge. You could be a realtor who needs to be kept up to date with the few remaining 100% programs so you can let your clientele know about them or, you could be a mortgage lender who wants to learn more about available products so you can serve your clients in a more effective manner.

What ever your situation, I want to share some extremely valuable information that could keep you and the people you know, from wasting a ton of time and loosing a large amount of money.

100% financing in California is available through government sponsored programs. The two most common programs are called CalHFA and FHA. This article will dominantly focus on the CalHFA and FHA because they apply to the largest demographic. There are also other programs for educators and employees who work for a school district and receive salaries and if you are a U.S. Vet then the VA is a great option as well.

For First Time Home Buyers, CalHFA offers down payment assistance programs which provide a helping hand of 3% of the sales price. This has to be paid back when you sell or refinance your home and is extremely beneficial because if there is a lack of funds to close, the 3% helps to absorb the closing costs and you don’t have to pay those “absorbed” out of pocket expenses. There are different down payment assistance programs and the parameters differ upon which of them you qualify for.

Seller concessions are also important because they will absorb other closing costs as well. Seller concessions are common (especially in a buyers market) and CalHFA allows seller concessions designed as follows:

• 3% of you are borrowing 90% of the property value or more.

• 6% if you are borrowing 90% of the property value or less

Add the Seller Concession to the Down Payment Assistance and you are looking at some major help to get into your home.

FHA allows 6% Seller Concession and there are similar down payment assistance programs available (similar to that of CalHFA).

Neither CalHFA nor FHA loans are subject to the California declining market decrease of 5% because CalHFA is its own entity (separate from mainstream housing lending) and FHA loans are federally insured.

I highly suggest that if you are a First Time Home Buyer then you look at these opportunities and get a professional to pre-approve you, NOT pre-qualify you. The difference is a pre-qualification is a verbal go ahead and means nothing to a lender. A pre-Approval is a green light to go and get a house because under the approved information that you have submitted, you will be able to proceed into negotiations. A pre-approval is also a green light for an appraiser, a realtor, as well as buyers and sellers.

Experienced real estate agents who know that they are doing will have you get pre-approved before they take you out to look at homes. This gives you a clear picture of how much money you can spend and it gives your realtor a chance to do some research on the available inventory of homes so they can show you exactly what fits your needs.

For future information, there are many discussion boards, blogs, news sites, magazines and other sources of information that are available for you to review. It is always a good. My intent is to educate you so that you know that there are still opportunities out there and they are available to those who are willing to qualify for them.

If you want my FREE REPORT on “5 Reasons You Should Avoid CalHFA Loans!” please email me at with “CalHFA FREE REPORT!” as the subject!

I have one additional report that will help home buyers and Realtors get offers accepted in the market.  “The 3 Things Every REO Offer Needs to Get Accepted by the Bank

If you would like this FREE REPORT please email me at with “REO OFFER REPORT” as the subject.

For future and archived articles go to: Mortgage News Network



  1. california is broke due to millions of illegal immigrants getting welfare checks for their babies, they work in macys, dept stores, resteraunts ect,, they work under other peoples social security card numbers, so state considers them not working, so they make around 5000 a month, including the 2000 dollars welfare check , they drive brand new cars buy homes ect, I know this because i know many of them, and worked in a hospital labor and delivery, where the social worker goes to them to hand the check to them Any way I dont want to hear how Arnold is budgeting and raising taxes, seniors did not get their rebate checks this year, fire man and police men and school teachers will suffer in budget cut downs, while we spend 280 BILLION A YEAR JUST ON ILLEGAL IMMIGRANT WELFARE CHECKS ALONE IN THE STATE OF CALIF (and that doesnt include medical,free lunches, and wic). And citizen who live in mexico are collecting welfare checks from the state of calif, they come over here to have their babies, then move back to mexico and just use a relative or friends address in the states and say they live there. So Arnold needs to stop this abuse, and take care of americans!!!

    Comment by GIGI — January 15, 2009 @ 3:33 am | Reply

    • My dear Gigi. Do some research before you post such accusations. I can tell you are full of envy/hate toward illegal immigrants. I previously worked for the wlefare dept and I can tell you that in no case does a family or child get a 2K check from the welfare department. Normally one child will get anywhere from 185-300.00 a month, and food stamps if the family qualifies. Clearly this amount is not enough to buy a home or buy an expensive car. Being that they are illegal immigrants does not allow them to purchase a home. If the parents are illegal immigrants they do not get a penny from the goverment, that is why they work SO HARD FOR OUR COUNTRY, illegal immigrants do the jobs no one else will work, and please do not say this is not true, we (all races) know that. There is a lot of abuse in Welfare System, but it is mainly by Americans that refuse to work and prefer to stay home and make babies and live of freebies. Do your research. It is ver sad to hear ignorant people like yourself making such strong accusations over a certain group of individuals (illegal immigrants). You are obviously not successful and feel the need to blame someone. Go to school, get a better job and a better attitude towards all and you too can be succesful in this country.

      Comment by jackie — August 26, 2012 @ 4:00 pm | Reply

  2. I want to know where can i get my welfare check for 2,000 dollars? I think that is a little too much hate on your part.That is not true.I have a good job and still don’t make 5,ooo a month either so that is not true either.
    What the Gov. should due is all the people that have welfare to take care of their labor issues is take away their tax refund to pay back. All people of all races.
    I don’t know why the hell the Gov. doesn’t use Illegal Immigrants to their advantage.They are so stupid. These people will do any thing to be here so legalize them all. Just charge off 5,000 for the paper work so that money can go to taxes and state.If they can’t pay off hand, give them 30 days or something. I mean it is not right in Gods eyes to be cruel to these people.You can talk crap all day and they are still going to be here so why not take advantage. You’ll see them selling their cars fast to come up with this money.Or charge more but something in this sense is a good idea.
    But I don’t think Cal. is broke due to Illegals. It’s all the Gov. fault and how they handle things.
    All I want is a home loan….

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