LAHD, CalHFA, MyHome, and MCC
TLDR Summary
- Multiple down payment assistance programs are available in Los Angeles.
- Most programs are designed for first-time home buyers.
- Assistance can significantly reduce upfront cash requirements.
- Some programs offer deferred or forgivable repayment.
- Choosing the right program depends on income, property type, and financing structure.
Buying a home in Los Angeles can feel out of reach for many buyers, especially when saving for a down payment. Fortunately, several local and state programs exist specifically to help first-time buyers overcome that hurdle.
Understanding how these programs work, and which ones apply to your situation, can make the difference between waiting years and buying sooner.
What Is Down Payment Assistance?
Down payment assistance programs help cover part of the upfront costs required to purchase a home. This support often comes in the form of a second loan that is deferred, forgivable, or repaid when the home is sold or refinanced.
These programs are commonly paired with FHA or CalHFA backed loans.
LAHD Down Payment Assistance Program
The Los Angeles Housing Department offers assistance to eligible first-time buyers purchasing homes within the city.
How It Works
LAHD provides a deferred payment loan that can be used toward the down payment and closing costs. Repayment is typically due only when the property is sold or refinanced.
Pros
- Can provide substantial assistance amounts
- No monthly repayment while living in the home
Cons
- Income limits apply
- Buyer education courses are required
- Property must meet program guidelines
CalHFA Loan Programs
The California Housing Finance Agency offers a range of loan products that can be combined with down payment assistance.
Common Options
- CalHFA FHA Loan
- CalHFA Conventional Loan
- CalHFA Preferred Loan
Pros
- Flexible financing structures
- Can be paired with additional assistance programs
Cons
- Minimum credit score requirements
- Interest rates may be higher than some conventional loans
MyHome Assistance Program
The MyHome program works alongside CalHFA loans and provides down payment assistance of up to 3.5 percent of the purchase price or appraised value, whichever is lower.
Pros
- Especially helpful for condo buyers
- Deferred repayment structure
Cons
- Limited to first-time buyers
- Must be used with a CalHFA first mortgage
Mortgage Credit Certificate (MCC)
The MCC program provides a federal tax credit that reduces the amount of income tax a buyer owes each year. This increases effective income and can improve mortgage qualification.
Unlike other programs, MCC does not provide cash upfront, but it can improve long-term affordability.
How Down Payment Assistance Affects Your Mortgage
Using assistance can lower the amount of cash needed at closing, improve debt-to-income ratios, and make approval more achievable. However, it is important to understand how layered financing impacts resale, refinancing, and long-term equity.
Are There Fees or Restrictions?
Some programs include application fees, resale restrictions, or occupancy requirements. Reviewing each program carefully before committing is essential.
Final Thoughts
Down payment assistance programs can be powerful tools for first-time buyers in Los Angeles. The key is matching the right program to your financial situation and long-term plans.
With the right structure, these programs can turn a difficult market into a realistic opportunity.