Buying your first home in Folsom can feel exciting and a little overwhelming. You may be wondering how much cash you really need, whether you qualify for help, and which programs work best in Sacramento County. The good news is, you have options that can lower upfront costs and make qualifying easier. In this guide, you’ll learn how CalHFA works, how it pairs with FHA and VA loans, and where to find local resources to move forward with confidence. Let’s dive in.
Why Folsom buyers look at programs
Folsom is a high-demand suburb in the Sacramento area, so purchase price and income limits can matter when you use assistance. State and county programs can help bridge the gap, but you need to match the right program to your finances and the property. You also want to plan ahead for class requirements, lender approvals, and timelines that come with down payment assistance.
When you understand the basics, you can shop with a stronger plan, a cleaner preapproval, and fewer surprises at closing.
CalHFA basics for first-time buyers
California Housing Finance Agency (CalHFA) is the main statewide option many first-time buyers in Folsom use. You combine a CalHFA-approved first mortgage with down payment or closing cost help layered as a junior loan.
First mortgages through CalHFA lenders
CalHFA does not lend to you directly. Instead, you apply with an approved participating lender that offers CalHFA first mortgages. These can be conventional, FHA, or sometimes VA-eligible pathways, depending on your situation. Start by reviewing the full menu of CalHFA first-time homebuyer programs, then contact a CalHFA participating lender to confirm what you qualify for.
Down payment and closing cost help
CalHFA also offers subordinate financing to help cover your down payment and part of your closing costs. These assistance loans are junior liens. Some require monthly payments, while others are deferred until you sell, transfer, or refinance. The exact amounts, interest terms, and repayment triggers change over time, so verify current details with your lender and CalHFA before you write offers.
Education and eligibility checkpoints
Most CalHFA paths require a homebuyer education course before closing. You can confirm accepted formats and providers on the CalHFA homebuyer education page. Eligibility typically includes:
- First-time buyer status as defined by the program
- Income and purchase price limits for Sacramento County
- Primary residence and occupancy requirements
- Minimum credit score and acceptable debt-to-income ratio
- Property type restrictions and condition standards
- Use of a CalHFA participating lender
Pairing CalHFA with FHA, VA, and conventional
Down payment assistance usually pairs with your first mortgage as a second loan. How that pairing works depends on the first mortgage type and the lender’s rules.
FHA with DPA
FHA loans are popular with first-time buyers because of flexible credit standards and a low minimum down payment. FHA allows the use of subordinate financing when it meets program and lender guidelines, including documentation of the assistance source and how payments are treated. If your assistance loan is deferred and has no monthly payment, it may be handled differently in qualifying than an amortizing second. Review the basics at FHA loan basics and confirm details with your lender.
VA options for eligible buyers
If you are eligible for a VA loan as a veteran or active-duty service member, you may be able to buy with no down payment. Many VA lenders can layer subordinate financing for closing costs if it meets VA and lender rules, though assistance is less commonly needed because VA already offers 100% financing. Check your eligibility at VA loan benefits and eligibility and ask your lender how they treat any junior liens.
Conventional paths
Conventional loans can also pair with down payment assistance if the lender and mortgage insurer allow it. Expect the lender to review your combined loan-to-value, mortgage insurance requirements, and any payment on the assistance loan to verify you still qualify under their debt-to-income limits.
Local resources in Sacramento County and Folsom
Beyond CalHFA, look at county-level programs and local guidance.
County and SHRA programs
The Sacramento Housing and Redevelopment Agency (SHRA) and Sacramento County Housing & Community Development periodically administer first-time buyer assistance and special initiatives. Funding cycles change, so it is smart to check current offerings directly through Sacramento Housing and Redevelopment Agency homebuyer assistance. You may also find information about Mortgage Credit Certificates (MCCs) when available, which can provide a federal tax credit on a portion of your mortgage interest.
City of Folsom housing info
The City of Folsom’s Community Development and Housing division posts updates on local housing initiatives. If the city sponsors or coordinates a homebuyer program, you will find it listed through City of Folsom Housing. Because local programs can change, always verify current status with the city.
Housing counseling and homebuyer classes
Homebuyer education is often required and always helpful. You can find approved counseling providers through the HUD-approved housing counseling finder. Counseling can help with budgeting, credit, and referrals to programs you might qualify for in Sacramento County.
Eligibility checklist for Folsom
Use this quick list to decide which options are worth pursuing:
- First-time buyer definition. Have you avoided owning a principal residence in the last three years, or do you qualify for a program exception?
- Income limits. Check the latest Sacramento County income limits for your household size.
- Purchase price limits. Confirm the price caps for the program and property type you are targeting in Folsom.
- Primary residence. Plan to occupy the home as your primary residence within the program’s required timeframe.
- Credit and debt-to-income. Ask your lender about minimum credit scores and how student loans, car payments, and assistance loans factor into qualifying.
- Property eligibility. Confirm whether condos, planned communities, or manufactured homes are allowed under the program and first mortgage.
- Education requirements. Complete required homebuyer education early so it does not delay closing.
- Lender participation. Choose a lender approved for your chosen program, especially for CalHFA.
Documents you will need
Gather and organize these items early:
- Government ID and Social Security numbers
- Recent pay stubs for at least 30 days
- W-2s or 1099s for the past two years
- Federal tax returns for the past two years
- Recent bank statements for checking, savings, and assets
- Signed gift letter and donor statements if using gifts
- Rental history or landlord contact if requested
- Proof of completing required homebuyer education
Step-by-step from preapproval to keys
- Review your finances. Estimate your monthly budget, cash on hand, and credit readiness.
- Take an approved homebuyer class if you plan to use assistance.
- Talk to a CalHFA participating lender to compare FHA, VA, and conventional paths with and without assistance.
- Verify eligibility. Confirm income, price caps, property type, and education requirements for Sacramento County.
- Shop homes that align with your loan type and program limits. Structure your offer with the right financing and timelines.
- Complete underwriting. Your lender will process the first mortgage and assistance at the same time.
- Close and move in. Know when your assistance is due and how it affects future refinances or a sale.
Pitfalls and smart tips
- Verify program numbers. Assistance amounts and limits change. Get current details from CalHFA and SHRA before you rely on them.
- Understand repayment. Many assistance loans are deferred but still must be repaid at sale, transfer, or refinance.
- Watch debt ratios. An amortizing assistance loan adds a payment that can impact qualifying.
- Mind price caps. Folsom’s higher prices can hit program ceilings faster. Be ready with backup loan options.
- Plan for timing. Education certificates and assistance approvals can add steps to your closing timeline.
Next steps
If you are serious about buying in Folsom, start with education and a strong preapproval. Review CalHFA first-time homebuyer programs, complete your class, and speak with a lender who works with CalHFA and local county programs. Then map out two or three loan scenarios so you can write offers with confidence.
When you are ready to tour homes and compare your options, connect with a local team that will guide you from planning to keys and beyond. If you want a clear plan tailored to your budget and timeline, reach out to Trent Andra for a friendly, no-pressure conversation about your next steps.
FAQs
What does “first-time buyer” mean for CalHFA in Sacramento County?
- Many programs define first-time as not having owned a principal residence in the past three years, but you must verify the exact definition for the program you choose.
Can I use CalHFA assistance with an FHA or VA loan in Folsom?
- Often yes, if the specific CalHFA product and your lender allow it and the loan meets FHA or VA rules for subordinate financing.
Will down payment assistance increase my monthly payment?
- It depends on the assistance structure; deferred loans may not add a monthly payment, while amortizing loans will add one that counts in qualifying.
Are there local Folsom or Sacramento County programs I should check?
- Yes, start with SHRA and Sacramento County programs and review city resources; availability and funding change, so always confirm current status.
Can USDA loans work in or near Folsom for first-time buyers?
- Some areas outside denser parts of the county may qualify, but eligibility depends on location and income; check maps and lender guidance.
What documents should I have ready before I apply for assistance?
- Expect to provide ID, Social Security numbers, pay stubs, W-2s or 1099s, tax returns, bank statements, any gift documentation, rental history, and your education certificate.
