Qualified Home Loans

Updated CA Dream For All – Funding and Parameters

The California Housing Finance Agency (CalHFA) is gearing up for Phase 2 of its very exciting Down Payment Assistance (DPA) program called the Dream for All program. This equity share program had some of the most substantial benefits of all the DPA programs. However, within a week, the program ran out of its initial $300M funding. In light of this, CalHFA restricts the program to better those most underserved.  With $255 million allocated for Phase 2 and a solid commitment to increasing homeownership opportunities, CalHFA aims to address housing affordability challenges. Let’s delve into the key proposed changes that homebuyers and real estate enthusiasts need to know.

Phase 2 Allocation

In its continued effort to assist homebuyers, CalHFA has allocated an additional $255 million for Phase 2 of the program. This allocation is expected to support around 2000 Down Payment Assistance (DPA) loans, making homeownership more accessible to a broader range of Californians. Considering the previous popularity, we expect these funds to be exhausted in the first month.

Release Schedule

Mark your calendars! March 2024 is the proposed release date for Phase 2. This gives potential homebuyers ample time to prepare and get their finances to take advantage of the program.

Income Limits

To ensure that the program benefits those who need it most, CalHFA is reducing the income limits for eligibility. Potential homebuyers must have at most 120% of the Area Median Income (AMI). This adjustment ensures that the program reaches those in the moderate-income bracket, providing them with vital assistance in achieving homeownership. This is a significant drop. In most cases, if you make more than $105,000 per year, you will no longer qualify.

Maximum Down Payment Assistance (DPA)

To align with market realities, CalHFA is capping the maximum DPA amount at the lesser of $150,000 or 20% of the home purchase price. This change aims to strike a balance between helping buyers with their down payment and reflecting property values in different regions of California.

Loan-to-Value (LTV) Requirement

CalHFA is introducing a minimum Combined Loan-to-Value (CLTV) requirement of 95%, with a maximum allowable borrower contribution set at 5%. These requirements are in place to ensure responsible lending practices while still providing essential assistance to homebuyers. We would assume the intent here is to be sure funds are reserved for those with a low down payment and not increase the purchase power of those who were making a down payment.

Voucher and Lottery System

One of the most exciting developments is introducing a voucher and lottery system through an online portal. This system will revolutionize the selection process, making it more accessible and equitable. CalHFA aims to increase uptake compared to the first release, particularly in underserved and geographically disadvantaged areas.

Time Limit for Voucher Usage

CalHFA recognizes the importance of expediting the home-buying process. As a result, borrowers selected through the voucher system will have a specified time limit within which they must enter into a contract to purchase a home. This will help ensure that DPA funds are put to good use efficiently.

First-Generation Homebuyer Requirement

A new eligibility requirement has been introduced for first-generation homebuyers. Buyers must not have owned a home or had parents who owned it in the past ten years to qualify. CalHFA is developing an attestation process for this requirement, which the agency will validate to ensure compliance.

Maximum Sales Price

Lastly, the proposed maximum sales price for homes eligible under this program is $800,000. This figure considers California’s diverse real estate market and aims to assist buyers in varying price ranges.


CalHFA’s Phase 2 program is poised to significantly impact a lucky few homebuyers in California by introducing these fundamental changes. With increased funding, a more equitable selection process, and a focus on serving underserved communities, this program promises to expand homeownership opportunities for thousands of Californians. As the program’s March 2024 launch date approaches, aspiring homebuyers should stay informed and prepare to take advantage of these valuable resources. CalHFA’s commitment to housing affordability and equity is a beacon of hope for those seeking to achieve the dream of homeownership in the Golden State.

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