The East Valley Homeownership Opportunity Program (East Valley HOP) is designed to help qualified home buyers overcome the three principal barriers to home ownership:
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Lack of information about the home buying and financing process.
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Insufficient savings for a large down payment.
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The housing affordability gap.
The East Valley HOP offers a free, three-hour home buyer education workshop. Attendance at this workshop or a workshop provided by an approved non-profit homebuyer education organization is required to get started. The workshop provides general information about the home buying process, qualifying for a home loan, shopping for a home, and preserving your status as a home owner once the purchase is completed.
In addition to attending a workshop, you should schedule an individual counseling session as soon as possible. At this meeting we will review your individual situation, discuss all of your home buying options, and in most cases complete the approval process. We will also help you get started searching for your new home.
The East Valley HOP requires a down payment equal to one (3%) of the home purchase price. At least one percent (1%) of the money must be from your own verified funds the balance of the down payment requirement can come from verified gift sources (e.g. parents, family members).
The East Valley HOP provide a "silent" down payment assistance loan to fill the affordability gap between the amount you qualify for on your own and the actual price of the home you are going to purchase. This loan requires no monthly payments.
The best way to understand how the government home buy programs work, is to imagine a layer cake. Each layer of the financing cake boosts your purchase power and lowers your payments.
Here is an example based on a $300,000 home purchase price:
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First Layer: BUYERS DOWN PAYMENT - $9,000
At least $3,000 from the buyer's own funds, the balance can be gift funds from family.
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Second Layer: FIRST MORTGAGE - $216,000
The first mortgage must be a 30-year, fixed rate loan (Conventional or FHA/VA). You will make monthly payments on this loan. Your total payment will include insurance and property taxes. If you buy a condo or town home, you will also pay a homeowners association (HOA) fee each month.
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Third Layer: EAST VALLEY HOP SECOND MORTGAGE - $75,000
The East Valley HOP requires no monthly payments. It is a "silent" or "soft" loan, repayment of the principal balance is deferred for 45 years until you sell the home. During this time, you don't have to worry about this loan, it is not part of your monthly budget.
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In some situations you will be eligible for additional help. Other government agencies such as the City of Los Angeles and the State of California may provide help such as a Mortgage Credit Certificate or additional "silent" loans. Whenever possible, these resources ("icing on the cake") will be offered to you.
