Can I Really Buy a Home in California With Little or No Down Payment?
Can I Really Buy a Home in California With Little or No Down Payment?
No, you cannot buy a home with literally zero money upfront. Every purchase requires an earnest money deposit, which shows the seller you are serious. That said, there are ways to make this upfront cost manageable. Many buyers can get some or all of their earnest money back after escrow closes.
If you have very little saved for a down payment, you can bridge the gap using down payment assistance programs and sometimes seller concessions. With the right programs, planning, and guidance, buying a home in California is still within reach.
This article explains the key programs at the state, county, and city levels, highlights options for certain occupations, and shows how buyers can realistically access help to get into their first home.
Why Down Payment Assistance Exist
Down payment assistance programs were created to help buyers who have steady income but cannot accumulate tens of thousands for a traditional down payment. California’s high home prices often make saving the full amount unrealistic for first time buyers.
Assistance comes in three main forms:
Grants – money you do not have to repay.
Deferred loans – no payments until the home is sold, refinanced, or the mortgage is paid off.
Forgivable loans – funds are erased after a set number of years of ownership.
These programs make it possible to buy sooner, reduce stress, and start building equity faster.
Statewide Programs in California
California Dream For All Shared Appreciation Loan
This program provides a large portion of the down payment without monthly payments. Instead of interest, the state receives a small share of any future home appreciation when the property is sold or refinanced. It is designed for first time buyers willing to share a small part of future equity to access immediate homeownership.
CalHFA MyHome Assistance Program
The MyHome program offers deferred loans for down payment or closing costs. No payments are required until the primary mortgage is paid off or the home is sold. It works with CalHFA first mortgages, FHA loans, and some conventional options.
CalHFA School Teacher and Employee Assistance Program
This program supports teachers, administrators, and other school staff across California. It provides additional down payment funds that can be combined with a CalHFA first mortgage.
County Level Assistance Programs
Los Angeles County Home Ownership Program
This program provides deferred loans for first time buyers who meet income limits. Funds can be applied to down payment or closing costs and are repaid only when the home is sold or refinanced.
Orange County Mortgage Assistance Program
Helps lower- and moderate-income households with a silent second mortgage to cover down payment and closing costs.
San Diego County First Time Homebuyer Program
Deferred loans cover part of the down payment and closing costs. Typical requirements include income and purchase price limits.
Bay Area Shared Equity Programs
Alameda and Contra Costa counties offer shared equity assistance. These reduce upfront costs in exchange for a small portion of future appreciation. This is ideal for buyers who earn too much for state programs but cannot save enough for a competitive Bay Area purchase.
City Level Programs
City of Los Angeles
The Low Income Purchase Assistance Program (LIPA) offers deferred loans. The Mortgage Credit Certificate program reduces federal tax liability and overall homeownership costs.
City of Long Beach
Offers a silent second loan paired with FHA, VA, or conventional mortgages. Homebuyer education and income limits apply.
City of Sacramento
Deferred loans cover down payment and closing costs. Funds are repaid when the property transfers or the primary mortgage is refinanced.
City of San Jose
Targets moderate-income buyers who live or work in the city. Deferred loans help buyers compete in a high-cost market.
Programs for Specific Occupations
Certain occupations support the community but face affordability challenges. Several programs recognize this:
Teachers and School Employees – CalHFA and city programs offer extra funds and often reduce mortgage insurance requirements.
Healthcare Workers – Some counties partner with hospitals to provide grants or forgivable loans for nurses and other medical staff.
Firefighters and Law Enforcement – Certain counties provide priority access, lower rates, or additional down payment support.
Military and Veterans – While VA loans already offer zero down payment, some local programs provide funds for closing costs or earnest money deposits.
How to Know Which Program You Qualify For
Qualification generally depends on:
Income limits based on county and household size.
Purchase price limits set by state, county, or city programs.
First time buyer status, typically no ownership in the past three years.
Occupation, residency, or work location can expand eligibility. Many buyers qualify for more than one program, and some options can be layered for maximum benefit.
The Real Benefit of Down Payment Assistance
Down payment programs do more than help with cash. They allow buyers to:
Buy sooner and start building equity instead of watching rent climb.
Reduce monthly payments and make offers more competitive.
Access opportunities otherwise out of reach due to limited savings.
Even a modest amount of assistance can make a meaningful difference. Planning carefully and working with an experienced lender or agent ensures that assistance is applied effectively and reduces surprises during escrow.
For more info, join my email list.
