CalHFA Equity Builder Loan (EBL): Forgivable Down Payment Assistance for First-Time Buyers
The CalHFA Equity Builder Loan (EBL) is one of the most talked-about California first-time homebuyer assistance programs. It helps qualified buyers cover their down payment and closing costs with a forgivable loan, making homeownership more achievable.
What Is the CalHFA Equity Builder Loan?
- A forgivable loan that covers up to 20% of a home’s purchase price.
- Targeted at first-time buyers with low to moderate income.
- Reduces the size of your mortgage loan and monthly payments.
How the Money Can Be Used
- The loan is a silent second mortgage (no monthly payments, no interest).
- Funds can be applied toward down payment and closing costs.
- Example: On a $400,000 home, you may receive up to $80,000 in assistance.
Loan Forgiveness Timeline
- 100% forgiven after 5 years if you live in the home as your primary residence.
- If you sell, refinance, or move out before 5 years, repayment is prorated:
- Example: Sell after 3 years → 40% forgiven, 60% repaid.
CalHFA EBL Program Requirements
To qualify, you must:
- Be a first-time homebuyer (no ownership in the past 3 years).
- Meet income limits (varies by California county).
- Work with an approved CalHFA lender.
- Complete homebuyer education counseling.
- Purchase a California property as your primary residence.
Why the CalHFA Equity Builder Loan Matters
For many Californians, saving for a down payment is the biggest barrier to buying a home. The EBL removes that obstacle by:
- Providing up to 20% of the purchase price.
- Forgiving the loan after 5 years.
- Allowing families to build equity faster.
👉 If you’re buying in Sacramento, Folsom, Elk Grove, or anywhere in California, the CalHFA Equity Builder Loan can be the difference between renting and owning.
Frequently Asked Questions (FAQ)
Is the CalHFA Equity Builder Loan free money?
Not exactly — it’s a forgivable loan. You don’t make payments, and after 5 years of living in the home, you don’t have to repay it.
Can I combine the Equity Builder Loan with other CalHFA programs?
Yes. Many buyers pair EBL with programs like CalHFA MyHome Assistance to maximize support.
Do I need perfect credit to qualify?
No, but you must meet your lender’s minimum credit requirements and CalHFA’s guidelines.
What happens if I sell before 5 years?
You repay a prorated portion of the loan. Example: sell after 3 years → 60% is repaid, 40% forgiven.ed CalHFA lender.
• Must complete homebuyer education.
• Property must be in California and used as a primary residence.
