Key differences between down payment assistance programs

Most CalHFA programs, including MyHome, ZIP, and MyAccess, require you to be a first-time homebuyer, defined as someone who hasn’t owned a principal residence in the last three years. The Dream For All program is unique because it imposes a stricter first-generation homebuyer requirement. This means not only must you be a first-time buyer, but your parents must not currently own a home in the U.S. (or didn’t at the time of their death), and you cannot have owned a home in the last 7 years. This targets assistance toward those without intergenerational wealth.

With the exception of the ADU Grant Program, all major CalHFA down payment assistance options (MyHome, ZIP, MyAccess, and Dream For All) are deferred-payment loans, not grants. You do not make monthly payments on them while living in the home, but they must be repaid in full when you sell the property, refinance, or pay off the first mortgage. The ADU Grant Program is the outlier; it provides up to $40,000 for pre-development and closing costs for building an Accessory Dwelling Unit, and because it is a grant, it typically does not require repayment.

Generally, CalHFA does not allow “subordination” for MyHome, ZIP, or MyAccess loans. This means if you want to refinance your first mortgage later to get a lower rate, you must pay off these assistance loans in full. The major exception is the Dream For All program. CalHFA allows a one-time re-subordination for Dream For All borrowers. This allows you to refinance your first mortgage (for a lower rate or term) without having to immediately repay the 20% shared appreciation loan, provided you do not take cash out.

Almost all CalHFA subordinate loans can be applied toward closing costs, but restrictions apply. ZIP is exclusively for closing costs and prepaids; it cannot fund your down payment. MyHome and MyAccess are flexible: they can fund the down payment and/or closing costs, though most borrowers use MyHome for the down payment first because it covers the exact minimum requirement. Dream For All funds can also be used for both down payment and closing costs (including buying down the interest rate), offering the highest versatility due to the large loan amount available.

The interest rate structure is a key differentiator. The Zero Interest Program (ZIP) is the cheapest in terms of rate, charging 0.00% interest. The MyHome and MyAccess programs charge a low 1.00% simple interest (interest does not compound). The Dream For All program technically has a 0% interest rate, but it includes a “shared appreciation” mechanism. Instead of paying interest, you pay back a percentage of the home’s value increase (typically 20%) when you exit the loan. If the home value doesn’t increase, you generally only owe the original principal on the Dream loan.

The loan limits vary significantly. MyHome is capped at 3.0% of the sales price/value for Conventional loans and 3.5% for FHA loans, which is just enough to cover the minimum required down payment. MyAccess provides a fixed 2.5% of the loan amount. ZIP offers 2.0% or 3.0% of the loan amount. In sharp contrast, Dream For All offers up to 20% of the sales price or value (up to $150,000). While MyHome helps you enter the market with minimum equity, Dream For All helps you avoid mortgage insurance and lower your monthly payments by providing substantial immediate equity.

Yes, but it depends on the specific program combination. The CalPLUS series of loans is explicitly designed for stacking: you can combine the ZIP loan (for closing costs) with the MyHome loan (for down payment) on the same transaction, resulting in three total loans (First Mortgage + MyHome + ZIP). However, the Dream For All Shared Appreciation Loan cannot be combined with MyHome or ZIP; it serves as a standalone assistance option because it provides a massive 20% down payment on its own. You can, however, stack Dream For All with non-CalHFA community seconds if they meet specific guidelines.

While both MyAccess and ZIP are subordinate loans attached to specific “CalPLUS” first mortgages, they differ in flexibility and cost. ZIP offers a 0% interest rate but is restrictive: funds can only be used for closing costs. MyAccess charges 1.00% simple interest (similar to MyHome) but offers greater flexibility, allowing you to use the funds for either the down payment or closing costs. This makes MyAccess a better option if you are short on the minimum down payment funds, whereas ZIP is superior if you have your down payment saved but need help with closing fees.

Unlike standard programs that offer fixed low-interest loans, the Dream For All program provides a significantly larger loan amount—up to 20% of the home’s value (capped at $150,000)—in exchange for a share of the home’s future appreciation. While MyHome and ZIP charge simple interest (1% or 0%), Dream For All charges no monthly interest; instead, when you sell or refinance, you repay the principal plus a percentage of the home’s increase in value (usually 20%). Furthermore, this program requires at least one borrower to be a first-generation homebuyer, a stricter standard than the first-time buyer requirement for other programs.

The primary difference lies in how you can use the funds and the interest rate charged. The MyHome Assistance Program is designed primarily for your down payment, though it can also be used for closing costs. It carries a simple interest rate of 1.00%. In contrast, the Zero Interest Program (ZIP) is strictly limited to covering closing costs and prepaid items; it cannot be used for the down payment. However, as the name implies, the ZIP loan has an interest rate of 0.00%. Additionally, ZIP is only available when you choose a “CalPLUS” first mortgage, whereas MyHome is available with standard CalHFA loans.