Help Buying a Home

City of San Marcos residents can access the County of San Diego’s first-time homebuyer program to help purchase their first home. This program provides eligible households a 3% interest, deferred-payment loan:

• Up to 17% of the purchase price for the down payment
• Up to 4% of the purchase price for closing costs

The program applies to single-family homes, townhomes or condominiums in San Marcos.

Check eligibility requirements

1. Income limit: Household income must be at or below 80% of the County's area median income.
2. Personal contribution: You must contribute at least 3% of the purchase price.
3. Primary residence: The home you purchase must be your primary residence.
4. Complete homebuyer education: You must complete a class through a HUD-approved homebuyer education provider before using the program.

Follow these steps to get started

1. Talk to a lender
   Start by discussing your ability to qualify for a mortgage with a lender.
2. <br=""> Be prepared to meet additional requirements, including providing your contribution and completing the education course.</br="">
3. Work with your loan officer
   Your loan officer will handle the application process for down payment and closing cost assistance. They will:

You do not apply directly to the County of San Diego or SDHC.

For more information, including eligibility details and maximum purchase price, visit the San Diego County Homebuyer Program website. For San Marcos' affordable for-sale guidelines, please see Affordable For-Sale Housing Program Guidelines(PDF, 355KB). 

This program is administered by the San Diego Housing Commission on behalf of the County of San Diego.

The Downpayment Assistance Program is funded by the CalHome Program and offers eligible first-time homebuyers a simple interest, deferred payment loan to assist with the purchase of a home within the City of San Marcos. The loan must be used in conjunction with an original first, fixed-rate, fully amortized 30-year loan. The loan provides gap financing between the first mortgage and the purchase price of the property. This program is subject to availability of funds.

Resources

Self-qualification form(PDF, 269KB)
Lenders(PDF, 112KB)
Application(PDF, 392KB)
Program policies and procedures(PDF, 1MB)
Report a concern

Who is eligible? 

• First-time homebuyers (applicants cannot have owned a home in the last 3 years), displaced homemakers and single parents.
• Legal residents of the United States.
• Applicants’ combined projected income must not exceed 80% of the Area Median Income (AMI) for San Diego County as determined by the California Department of Housing and Community Development.
• Applicant must have sufficient funds to meet the required downpayment, closing costs, monthly mortgage payments, property tax, homeowner insurance and homeowner association dues, if applicable.

What are the income limits?

• The applicant’s household gross income must not exceed 80% of Area Median Income (AMI). 
• Household gross income includes the income for all wage earners who will occupy the home

What types of properties are eligible?

• New or resale single-family detached homes, condominiums, townhomes and manufactured homes on a permanent foundation secured by real property (i.e., must own or purchase the land on which the manufactured home is, or will be, located).
• Home must be vacant or occupied by the seller/owner or the DAP applicant and not have been "recently vacated” by renters. "Recently vacated" means the property has been vacant for at least four months prior to acceptance of a contract to purchase.
• Home must be free from any health and safety defects, lead-based paint hazards, meet local and State building standards, and pass basic health and safety inspection.

What are the rates and terms?

• 3% simple interest, 30-year deferred loan.
• Loan amount 20% of the purchase price, with a maximum amount of $56,000, whichever is less.
• Applicant must contribute 3% of the purchase price from own funds from verifiable sources for downpayment.
• First loan may not have negative amortization, principal increase of deferred interest, or a balloon payment prior to 30 years.
• First loan must be made by one of City’s participating lenders.
• Loan is not assumable and becomes payable upon sale, transfer, or expiration of loan period (30 years).
• Loan requires deferred repayment of loan principal plus 3% interest when the first mortgage is paid off, or when the homeowner vacates the property.
• Loan is secured by a Deed of Trust.

What are the requirements of the program?

• Home must be principal residence.
• Appraised value of home may not exceed $598,000.
• Applicant must complete a Homebuyer Education Class. Credit.org is the approved homebuyer education provider for the City of San Marcos.
• Participation in the Mortgage Credit Certificate (MCC) program if there is available funding.
• Applicant must pay a $350.00 non-refundable DAP application fee.

What are the debt-to-income ratios?

• Applicants monthly housing cost, including property taxes, property insurance, mortgage insurance, homeowner’s association dues, and utilities may not exceed 36% of the household’s gross income.
• The ratio of total monthly debt, including the monthly housing cost, may not exceed 45% of the household’s gross income.

What are the procedures for obtaining a city loan?

• Review the other information within the FAQs to ensure compliance with program requirements /
• Complete the DAP Self-Qualification and Application Forms(PDF, 269KB) and take them to the City’s participating lenders. A loan officer will pre-qualify you for their loan and the City’s DAP loan at the same time.
• Attend a homebuyer education class provided by Credit.org.
• Shop for a home that meets the program requirements.
• Lender prepares and submits DAP application packet to City for approval.

Can an applicant bring their own lender to the program?

No, an applicant must choose a lender from the City's Participating Lender List(PDF, 112KB). The city does not have wholesale lenders on its approved list.