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What is a CalPLUS Conventional Loan with Zip Extra?

It is no secret that living in California is more expensive than most other areas of the country. Due to that, owning a home can be rather difficult. First time homebuyers do have the chance to obtain financing with the Calplus Conventional Loan with Zip Extra. This loan makes it possible for many people to purchase their first home without needing a large number of assets or requiring them to deal with a large down payment.

What is CalPLUS?

CalPLUS is a first mortgage that is backed with private mortgage insurance. This is what allows lenders to provide you with extensive fixed financing even in risky situations. The Zip component of the CalPLUS with Zip Extra Loan is the extra financing that is available for your down payment. This loan equals 3 percent of the amount of the first mortgage that you are obtaining and is a junior loan. The Extra component of the loan provides you with $6,500 towards your down payment and does not require interest. For example, if you were trying to purchase a home for $400,000, you would obtain a second lien for $8,000, which would cover the down payment in addition to the extra $6,500 towards the down payment.

Can you get a CalPLUS Loan with Zip Extra?

There are certain requirements that you must meet in order to obtain the CalPLUS Loan with Zip Extra, just like any other loan. For starters, you must be considered a low to moderate-income family. The limits for your family depend on the number of family members you have and where your home is located. If you fall within the parameters, you may be eligible for the loan if you meet the other requirements including the need for the home to be your primary residence; you need to obtain the proper home buyer education to ensure that you are informed on your mortgage; and your home needs to be within the sales price parameters for your area.

What about the Property?

As with any loan , there are certain property guidelines that must be met. The home needs to be a single unit. This could mean a single family home or a condominium. CalHFA must approve the condominium in order to be eligible. Manufactured housing is never eligible under this program nor is land trusts or co-ops.

Education is Required

In an effort to keep homeowners informed of their choices and what they are getting themselves into when getting a mortgage, home buyer’s education is required. The classes can be taken either online or in person, depending on what you prefer. The certificate of completion must be turned in with loan file in order to ensure your eligibility for the program. This is done in an effort to make sure that home buyers are not getting in over their head, getting a mortgage that they really cannot afford simply because they do not understand the terms.

Obtaining a CalPLUS Loan

It is simple to apply for a CalPLUS loan, as it works like any other loan. The key difference is finding a lender that offers these loans as only approved lenders can provide them. Once you find a lender, you will fill out an application, just like any other loan. You will also need to provide your proof of income, employment, and assets for a fair evaluation to be completed.

If you are a first time homebuyer in California, the CalPLUS Extra with Zip is a great alternative to help you get into the home you want. You are no longer stuck with the idea of renting when you would rather own as the mortgage is easy to obtain and provides you with many benefits. Make sure that you are using an approved lender that can explain everything to you and you will have a mortgage that will remain fixed for the next 30 years.