Redwood Credit Union Community Fund’s
First-time Homebuyers Down Payment Assistance Program Overview and Application

Thank you for your interest in the Redwood Credit Union Community Fund (“RCUCF”) First-time Homebuyers Down Payment Assistance (“DPA”) Program. Through the DPA Program, approved First-time Homebuyers may receive an assistance grant paid directly to the downpayment of a home purchase. All grants provided through this program are subject to the DPA Program Overview below as well as the Down Payment Assistance Conditional Offer Letter and all other program agreements and loan documents, which approved grantees must agree to as part of DPA Program.

DPA Program Overview

Introduction

Through the First-time Homebuyers DPA Program, recipients may receive a down payment assistance grant of up to 5% of the home price or $25,000 (whichever is less). DPA grants are issued at the sole discretion of RCUCF. DPA Program Application approvals are preliminary and may be rescinded if the applicant no longer meets the program requirements. Processing times for applications and grant issuance may vary and are not guaranteed.

Approved grantees must make a minimum borrower contribution of 1% of purchase. DPA grants may not be combined with any other grant programs and may only be used for the down payment of a home purchase.

DPA grants are paid directly to the purchase of the home, with no cash out at closing. DPA grants are structured as a loan with no interest and will be forgiven in increments beginning the 6th year after closing and annually thereafter through the 10th year after closing if the grantee remains in compliance with all requirements of the DPA grant. Payback of the full amount of the principal or a portion of the principal will be required if the grantee does not remain in compliance with the requirements of the DPA grant for the 10-year period after the closing.

Tax Notice

Down Payment Assistance may be subject to federal, state, and local taxes. Applicants are advised to consult their own accountant or tax advisor to determine any potential tax implication.

Applicant Eligibility

DPA grantees minimum eligibility requirements include, but are not limited to:

  • Grantees and their combined household income cannot exceed the Moderate Income level for the county in which they plan to buy a home. The California Department of Housing and Community Development determines the State Income Limits based on county and household size, use this as a guide to determine eligibility.

  • All grantees must be first-time home buyers, defined as having no ownership interest (sole or joint) in a residential property during the three-year period preceding the date of the application.

  • Prior to grant issuance, all grantees must complete Fannie Mae HomeView® homebuyer education course and provide certification of course completion before making an offer on a home.             

  • Employees, officers, or volunteer officers of Redwood Credit Union, Redwood Credit Union’s Services Group, or Redwood Group are not eligible to apply for DPA funds, reside in the home being purchased, or be listed as a co-applicant on the mortgage application.

  • RCU employees’ immediate family members (parents, siblings, children, including step-and foster-relations) may apply for DPA funding. All other DPA program requirements are still required. Funding for RCU employees’ immediate family members is capped at 25% of funding.

Note:  All borrowers on the first mortgage must also be DPA grantees. Additionally, all signers on the promissory note must be DPA grantees and occupy the residential property. No other co-signers or guarantors are permitted.

Property Eligibility

Property purchased using a DPA grant must meet the following eligibility requirements:

  • Property must be a 1-unit, primary residence of all DPA grantees, meeting Fannie Mae health and safety guidelines.

  • Purchased property can include 1-unit, attached & detached home, condo, co-op, tenants-in-common (TIC), or manufactured home (only if on owned property - excluding chattels.)

  • Purchased property must be located in one of the following California counties: Contra Costa, Lake, Marin, Mendocino, Napa, San Francisco, Solano, or Sonoma.

First Mortgage Loan Requirements

The mortgage loan used to purchase the property must meet minimum standards, including:

  • The combined loan to value may not exceed 97%.

  • The loan may not include any of the following features: balloon payment, interest-only, payment option/pick-a-pay, or negative amortization.

  • RCUCF reserves the right to review the mortgage loan documents and may require additional standards in RCUCF’s sole discretion.