First Responders Downpayment Assistance Loan Program (FRDALP)
The First Responders Downpayment Assistance Loan Program (FRDALP) is available through MOHCD Approved Participating Lenders Only
FRDALP PRE-APPROVAL IS NOW OPEN (7/5/2017- 8/21/2017)!
The homebuyer must first apply for pre-approval of a FRDALP loan and request a reservation of FRDALP funds. Reservations will be allocated through a lottery process.
No FRDALP Pre-Approval Application Fee. FRDALP Loan Application Fee $601 (non -refundable), or $721 if applying with Mortgage Credit Certificate.
FRDALP PROGRAM OVERVIEW
The First Responders Downpayment Assistance Loan Program (FRDALP) provides down payment assistance loans to active uniformed, sworn members of the San Francisco Police Department (SFPD), San Francisco Fire Department (SFFD) and San Francisco Sheriff’s Department (SFSD) to purchase their first home in the City and County of San Francisco. The FRDALP is a silent second loan that requires no monthly payments for 30 years. The principal amount plus a share of the appreciation (profit) shall become due and payable at the end of the term, or repaid upon sale or transfer.
HOW TO APPLY
MOHCD will accept complete Pre-Approval Application packets starting from 7/5/2017 to 8/21/2017.
To apply for a FRDALP Loan and Reservation, the Borrower must first submit a signed complete Pre-Approval Application Packet via a secure email link (click to access the link), or delivery by mail or in person to our office (Mayor’s Office of Housing and Community Development, One South Van Ness, 5th Floor, San Francisco, CA 94103 Attn: DALP Pre-Approval) by the application lottery deadline (5:00PM, 8/21/2017).
Please note that only one (1) Reservation is permitted per Eligible Household. Duplicate Pre-Approval applications from one Eligible Household, whether with one Lender or multiple Lenders, will automatically result in the City’s disqualification of all applications. Borrowers are encouraged to shop around to find the best participating Lender that suits their needs, but must choose only one Lender in connection with the DALP Program.
Complete packets received by the application lottery deadline will receive a numbered lottery ticket and be entered in MOHCD’s electronic system for the lottery based on MOHCD's standard lottery process. Incomplete packets will not be entered into the lottery. Please indicate your email address in the Pre-Approval Application if you would like receive your lottery ticket number. If no email address is provided, your lottery ticket number will be mailed to your mailing address provided in your application.
A Reservation does not constitute final loan approval nor guarantee funding. A FRDALP loan will only be funded when the Borrower receives a loan commitment from MOHCD, satisfies the Reservation timeframe described below and meets the FRDALP requirements.
1. Purchase Period (60 Calendar Days). The pre-approval is good for 60 calendar days. During such period, borrowers must enter into a sales contract.
2. Lender DALP Loan Submittal Period (30 Calendar Days). Within 30 calendar days following the execution of a sales contract, the Lender must submit a complete DALP loan packet to MOHCD.
3. MOHCD Review Period (10 Business Days). Upon receipt of a complete DALP loan packet, MOHCD will review it within 10 business days.
4. Loan Commitment Period (30 Calendar Days). Upon loan approval, MOHCD will issue a Commitment Letter that is good for 30 calendar days.
Your First Steps to Buy a House with a FRDALP Loan
Step 1: Complete Verification of Homebuyer Education Requirements — contact one of the five MOHCD-approved first-time homebuyer counseling agencies to get first-time homeownership counseling, and receive a Verification of Homebuyer Education.
Step 2: Get a pre-approval — select one of MOHCD-authorized lending officers to get a pre-approval on the primary mortgage loan based on the household’s financial needs.
Step 3: Submit a complete Pre-Approval Application Packet to MOHCD — MOHCD will place all complete Pre-Approval Application packets received by the application deadline in the lottery pool. A lottery will be conducted to determine the rank order. After the lottery, MOHCD will review and process the Pre-Approval applications adhering to the rank order of the lottery list, and send a written response to approve or deny the pre-approval application.
2017 DALP Timeline
The table below shows the projected DALP Timeline. Any changes will be immediatley updated and posted online.
- FRDALP Borrowers: The borrowers must be an active uniformed, sworn member employed by the San Francisco Police Department (SFPD), San Francisco Fire Department (SFFD) or San Francisco Sheriff's Department (SFSD). At the time of application, Borrower must provide a copy of verification of employment from their department to MOHCD.
- First-time homebuyers: No member of a household must have had any ownership interest in a residential unit in San Francisco for the last three years.
- Income Limits: household's income must not exceed 200% of the area median income (AMI). See Current Year Maximum Income Limits as of April 14, 2017 (PDF)
- Occupancy: The property must be owner-occupied during the life of the loan.
- Downpayment: Borrower must contribute a minimum of 5% (2.5% from borrower's own funds, and remainder from gifts or grants).
- Liquid Assets: Borrower must have no more than $60,000 after purchase. There is no limit on liquid assets before purchase.
- Reserves: Borrower must have a minimum of 3 months reserves (principal, interest, property taxes, hazard insurance and homeowner’s association dues) in reserves after purchase. In addition to Liquid Assets, vested funds from retirement accounts that permit withdrawals may be also used for reserves.
- Property Requirements: The property must be Single-Unit Residences located in San Francisco. The residences may be a single-family house, Condominium, Townhouse/Town Home, Loft or Live Work Unit (as long as the property will be used as the owner’s principal residence). Rental of any portion of the property is NOT allowed.
- Property Size Requirements: There is no requirement for the size of a household to be compatible with the size of the unit being purchased under the FRDALP program.
- Property Flipping: FRDALP cannot be used to purchase properties resold within 90 days and priced more than 20% above the initial purchase price.
- Inspection Reports: A “general home inspection” and a “pest control inspection” dated within 90 days of the FRDALP loan submission are required.
- Lien Position: FRDALP loan must be in second position behind the first mortgage.
- First Mortgage Loan Term: The first mortgage loan must be a 30-year fixed rate mortgage, the mortgage payment must be fully amortizing.
- Impounds: The first mortgage lender must collect and manage impound accounts for property taxes and hazard insurance for the loan term.
- LTV and CLTV Ratio: The minimum Loan-to-Value (LTV) is 50%, and the maximum Combined Loan-to-Value (CLTV) is 97%.
- Front-End (Housing) Ratio: No less than 33% and no more than 40%
- Back-End (Total Debt) Ratio: No more than 43%
- Co-Signing: Co-signing for a FRDALP loan by a non-household member is not allowed.
- Loan Signing: No power of attorney is allowed. All applicants must be physically present to sign loan documents.
- Closing Costs: FRDALP funds may be used to cover customary, non-recurring closing costs up to 2% of the purchase price or appraised value, whichever is less.
Click HERE for the DALP Frequently Asked Questions (FAQs)
Review FRDALP Manual for a detailed description of applicant qualifications, loan terms and requirements, and program procedures. See DALP Announcement 5-2017 for the new DALP application procedures.
- FRDALP Manual July 2017
- DALP Announcement 2017-5
- DALP Pre-Approval Application Packet May 2017
- Combined DALP Application 8-2017
- Sample FRDALP City Note
- Sample FRDALP City Deed
Mortgage Loan Officers (MLO) or mortgage brokers who would like to become participating lenders for MOHCD's homeownership programs, including DALP, MCC and TND must complete the required training and pay the required fee. Each individual MLO or mortgage broker must complete the training every year. All participating loan agents must provide their NMLS ID# to MOHCD and sign the Homeownership Programs Lender Agreement.
Workshops and counseling sessions are available in multiple languages. MOHCD encourages applicants to enroll in a homebuyer education course in their strongest language.