Buying your first home in California feels impossible. The median home price is over $800,000. A 20% down payment is $160,000. Even 3.5% down on a $600,000 starter home is $21,000. Where does that money come from?
That's where CalHFA comes in — and specifically, their Dream For All program, which can give you up to 20% of the purchase price for your down payment. But is it actually better than a standard FHA loan? The answer isn't as simple as you'd think.
I've helped California buyers navigate both options for years. Let me give you the honest, side-by-side comparison so you can make the right choice for your situation.
CalHFA vs FHA: The Head-to-Head Comparison
| Feature | CalHFA (Dream For All) | Standard FHA |
|---|---|---|
| Down Payment | Up to 20% provided (shared appreciation) | 3.5% (your own funds) |
| Min Credit Score | 660 | 580 (or 500 with 10% down) |
| Income Limits | 150% AMI ($130K-$280K+ by county) | No income limits |
| First-Time Buyer Required | Yes | No |
| Mortgage Insurance | Yes (FHA MIP or PMI) | Yes (FHA MIP for life of loan) |
| Homebuyer Education | Required | Not required |
| Loan Limits (2026) | Follows FHA/conforming limits | $498,257-$1,149,825 (by county) |
| Repayment of DPA | Original amount + 15-20% of appreciation | N/A (no DPA) |
| Best For | Buyers who need DPA and plan to stay 5+ years | Buyers with savings, lower credit, or repeat buyers |
CalHFA Dream For All: The Full Picture
Dream For All sounds amazing on paper — up to 20% down payment assistance with no monthly payments. But there's a catch that most articles don't explain clearly: shared appreciation.
How shared appreciation works: When you sell, refinance, or transfer the home, you repay the original DPA amount PLUS 15-20% of the home's appreciation. If your home goes up $200,000 in value, you owe the original DPA plus $30,000-$40,000 in shared appreciation. That's the "cost" of the free down payment.
Real Example: $650,000 Home in Sacramento
Is $41,000 worth it? That depends. If you couldn't have bought the home without DPA, and you built $205,000 in equity over 7 years, many would say yes. But it's not "free money" — it's a trade-off.
Other CalHFA Programs (Without Shared Appreciation)
Dream For All gets all the headlines, but CalHFA has other programs that might be a better fit:
MyHome Assistance Program
Up to 3.5% of the purchase price as a deferred-payment, simple-interest loan. No monthly payments — you repay when you sell, refinance, or pay off the first mortgage. No shared appreciation.
Best for: Buyers who just need help with the 3.5% FHA down payment and want to avoid shared appreciation.
CalHFA ZIP (Zero Interest Program)
Up to 3% of the loan amount as a zero-interest, deferred loan for closing costs. Can be combined with MyHome for both down payment and closing cost assistance.
Best for: Buyers who need help with closing costs on top of down payment assistance.
CalHFA Conventional Loan
A conventional loan with CalHFA rates. Requires 3% down (vs FHA's 3.5%) and PMI can be removed at 20% equity (FHA MIP is for life). Higher credit score required (680+).
Best for: Buyers with 680+ credit who want to avoid permanent FHA mortgage insurance.
Not sure which CalHFA program is right for you? Compare CalHFA-approved lenders who can walk you through all the options based on your specific financial situation.
Find a CalHFA-Approved Lender
Not all lenders offer CalHFA programs. Compare those who specialize in California first-time buyer loans.
Compare California Lenders →When to Choose CalHFA vs Standard FHA
Choose CalHFA If...
- ✅ You need down payment assistance
- ✅ Your credit score is 660+
- ✅ You're a first-time buyer
- ✅ Your income is within CalHFA limits
- ✅ You plan to stay 5+ years
- ✅ You're OK with shared appreciation (Dream For All)
- ✅ You can complete homebuyer education
Choose Standard FHA If...
- ✅ You have 3.5% down payment saved
- ✅ Your credit score is 580-659
- ✅ You're NOT a first-time buyer
- ✅ Your income exceeds CalHFA limits
- ✅ You want a simpler process
- ✅ You don't want shared appreciation obligations
- ✅ You want maximum lender flexibility
2026 CalHFA Income Limits by Region
| Region | CalHFA FHA Limit | Dream For All Limit |
|---|---|---|
| San Francisco Bay Area | $237,000 | $280,500 |
| Los Angeles County | $213,000 | $252,000 |
| San Diego County | $207,000 | $244,500 |
| Sacramento Metro | $183,000 | $216,000 |
| Riverside/San Bernardino | $168,000 | $198,000 |
| Central Valley (Fresno, Bakersfield) | $153,000 | $130,000-$165,000 |
Frequently Asked Questions
What is CalHFA Dream For All?
Up to 20% of purchase price as a shared appreciation loan. No monthly payments — you repay the original amount plus 15-20% of appreciation when you sell or refinance.
What are CalHFA income limits for 2026?
CalHFA FHA: $153K-$237K by county. Dream For All: 150% AMI ($130K-$280K+). These are household income limits.
Is CalHFA better than regular FHA?
For buyers who need DPA and plan to stay 5+ years: usually yes. For buyers with savings, lower credit (580-659), or who want simplicity: standard FHA may be better.
What credit score for CalHFA?
660 minimum for both CalHFA FHA and Dream For All. Standard FHA only requires 580 — so FHA is more accessible for lower credit scores.
Can I combine CalHFA with FHA?
Yes! CalHFA FHA + MyHome Assistance (3.5% deferred loan) is the most popular combination. You can also add ZIP for closing cost help.
Is Dream For All funding available in 2026?
Dream For All has limited funding and runs out quickly (often within hours of opening). Check calhfa.ca.gov for the next funding round dates and set alerts.
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