The four types of DPA in California
Every program in this directory fits into one of four structural categories. Knowing the category up front tells you what the long-term cost looks like.
1. Grants (never repaid)
A grant is a gift — you take the cash to close and never owe it back. The tradeoff is usually a higher rate on your first mortgage, which is how the agency funds the grant. GSFA Platinum is the biggest example in California; HUD Good Neighbor Next Door becomes a grant after 36 months of owner-occupancy.
2. Forgivable seconds (repaid or forgiven over time)
A forgivable second sits on your home as a silent lien. If you stay in the home long enough, the lien forgives on a schedule — typically 3, 5, 10, or 15 years. If you sell or refinance before the forgiveness clock runs out, you repay the remaining balance. The Chenoa Fund Soft Second is the main forgivable second for FHA buyers in California.
3. Deferred seconds (paid back at sale or refinance)
A deferred second is a silent lien with no monthly payment and either zero or low interest. The principal comes due when you sell, refinance, or stop living in the home — typically 30+ years later. CalHFA MyHome, LA County HOP, and City of LA LIPA are all deferred seconds. The money isn't free, but you never feel the cost while you live there.
4. Shared-appreciation loans (repaid with a share of equity)
A shared-appreciation loan is a second lien where repayment includes not just principal but a proportional share of your home's appreciation. CalHFA Dream For All is the marquee example — up to 20% of your purchase price in exchange for up to 20% of the home's future appreciation at sale. For someone who'd be priced out of the market entirely, shared appreciation is a fair trade. For someone with the down payment already saved, it's usually the wrong choice.
How California DPA stacks
Single programs are fine. Stacked programs are where DPA becomes transformative. Here are the four most common California stacks:
The Low-Income LA Stack
CalPLUS FHA + MyHome + ZIP + LA County MCC + 2% seller credit. For a City of LA first-time buyer under 80% AMI. FHA first mortgage, MyHome covers the 3.5% down, ZIP covers 3% closing costs, seller credit covers the rest, MCC delivers a $2,000/year federal tax credit for the life of the loan. Out-of-pocket: under $2,000.
The Dream For All Play
CalPLUS Conventional + Dream For All + CalHFA MCC. For a first-generation California buyer. Conventional first mortgage, Dream For All contributes up to 20% of the purchase price as a shared-appreciation second, MCC delivers tax benefit. Monthly payment is dramatically lower than 3%-down FHA alternatives because the LTV is 80% — no PMI, no MIP.
The GSFA Repeat-Buyer Play
FHA + GSFA Platinum grant + MCC. For a California buyer who isn't first-time (owned within the past 3 years) or whose income exceeds CalHFA limits. GSFA funds up to 5% grant via a rate premium on the FHA first mortgage. MCC adds federal tax credit on top. Closes in 21-30 days — faster than CalHFA.
The Veteran Play
VA loan + MCC. For eligible veterans. 0% down, no PMI, no income cap, plus a $2,000/year federal tax credit for life of the loan. The best mortgage in America when the borrower qualifies.
The single most important rule
Mixing incompatible DPA programs disqualifies all of them. The rules are specific: Dream For All cannot be combined with MyHome or ZIP. GSFA Platinum cannot be combined with any CalHFA DPA. Chenoa requires an FHA first mortgage and cannot layer with CalHFA. Most city programs stack with CalHFA but not with each other (LIPA and MIPA are mutually exclusive because they're different tiers of the same program). Work with a broker who runs the full matrix before you lock anything.