Homeownership: Like Starting a New Life


Pedro Chavez had a dream. His dream was to buy a home that would become a legacy for his wife, children and grandchildren.

Chavez said that he began working part-time as a young father as a way of bringing in more income. But then with two children, he felt he couldn’t afford it.

“I was thinking back in the 1980s, dreaming about having a house for my kids,” said Chavez, account manager for a landscaping company.  “It was impossible. The hourly wage was too low plus I was raising my kids. I decided, one day, I’m going to make it happen.”

His dream began to take shape again about two years ago. By this time, the family had grown to four children – all adults.

“In 2014, I decided to set up my goal, to have my own place in two years,” he said. “I thought I should be saving more for a down payment.”

He decided to seek out assistance for first-time homebuyers.


An Internet search took him to NeighborWorks Orange County. He attended a home-buying class in September 2014. The next year, his wife Teresa and daughter Alicia, also took a class.

“I found the right website with the right people,” said Chavez, a trim man who speaks with confidence about his experience. He said the greatest benefit he got was information.

“Myself, I had a lot of questions, but they explained everything,” he said. “How the process works. How the escrow works.  How to find the right Realtor. How to find the right house.  That helped me a lot, all the information that I got.”

He and his family began working with NeighborWorks to create the right financial package and to find the right house. 

They looked at 10 to 15 houses, and made offers on about a half dozen in Buena Park and Anaheim.  In a competitive market and improving economy, they sometimes would find themselves outbid or among a pack of potential buyers interested in the same house. The “Friendly Experts” at NeighborWorks assured the family that with Chavez’s work history and excellent credit, he would never lack for options.

Finally they came across a house in Anaheim. 


The Chavezes thought it was perfect. It had three bedrooms, two baths, wooden floors and a fireplace. The back patio was enclosed, providing an added area to entertain the couple’s children and grandchildren on their visits. A city park lies nearby.

“This gives us much more space,” said Teresa.

They offered $430,000. The owner asked if they would come up with a higher offer. 

Chavez offered $432,000, his maximum, yet remained worried that he wouldn’t have enough money to trim two large pine trees in front of the house that he feared would topple over. He also wanted to remove a ficus tree that was damaging the driveway and to grind down an unsightly stump in the back yard. He estimated the job would cost $2,500 at least. 

In the end, everything worked out.

The owner accepted the offer of $432,000. And a friend who ran a tree-trimming business said that he would perform the work on the trees that Chavez wanted for $700.

Chavez had concerns about signing a loan with variable interest rates. NeighborWorks Orange County helped the family put together a loan package that they felt comfortable with that included a $417,000 conventional, 30-year mortgage. The Chavezes put down the balance on the purchase. The house, built in 1955, has 1,461 square feet, built-in cabinet spaces and tiled bathrooms and kitchen counters.

After three decades as renters, the Chavezes made their dream come true when escrow closed Oct. 28, 2015.

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Pedro and Teresa, both 56, met at a dance club in Santa Ana as young adults. He had immigrated from Guanajuato state, Mexico, while she had come from Jalisco.  After he arrived from Mexico, Chavez took a job pushing lawnmowers and cutting hedges for a landscaping business. The couple got married in June 16. 1983.

Chavez wanted more for himself and his family, and he rose through the ranks of the landscaping business to foreman, field representative and account manager. Along the way he learned the ins and outs of irrigation systems, pesticides, and plant identification and disease. He also studied computers through a regional occupational program and became a part-time cook, learning under trained chefs at such venues as Knott’s Berry Farm.

That work created the foundation for the family to be able to pursue its goal of homeownership.

Life is better now, the Chavezes say.

The house has become a gathering place for Chavez’s four adult children, two of whom – Adriana Becerra, 32, and Melissa Rocha, 29, are married, and two of whom – Alicia, 25, and Pedro, 23, - live at the Chavez family home. Three small dogs – Sam, Ninja and Casper – also call the house their home. Dozens of family photos capture key moments in the family’s life.

“Before, it didn’t feel like we had anywhere to go,” said Adriana, whose son is 13.  “Now it feels like we have somewhere to go, a home, somewhere to come to.”

Teresa, a stay-at-home mom, said the area is an improvement over the neighborhood they had been renting in West Anaheim.


“It’s more peaceful here,” she said. “Where we lived before there were businesses and night clubs. There was a lot of noise.  I like everything here. The rooms are bigger. The other house was much smaller, and I used to have to hang the clothes outside to dry. Here I wash and dry in the house.”

Then she added with a laugh, “It’s bigger, so I have to work more to keep it clean.”

Chavez said he has already told friends about NeighborWorks. He smiled as he talked about having achieved his dream. 

“This process is life changing,” Chavez said. “From now on, it’s like starting a new life, and having new memories.”


NeighborWorks Orange County Announces Boost in Affordable Housing Funds

We are happy to announce that the pool of funds available for affordable housing in Orange County has grown by $500,000 as a result of an investment by Banc of California in NeighborWorks Orange County.

Under a program called California Organized Investment Network (COIN), Banc of California in return will receive a $100,000 tax credit. COIN aims to promote investment in low-income communities.

To qualify for the tax credit, administered by the state Department of Insurance, insurance companies, banks and other entities must invest a minimum $50,000 with a certified Community Development Financial Institution such as NeighborWorks for at least five years at 0 percent interest. The 20 percent tax credit is allocated in the first year.


Glenn Hayes, president and CEO of NeighborWorks Orange County, said that the $500,000 investment is the largest that his organization has received under the COIN program, which launched in 1997. He said that the Banc of California investment would push the level of such funding his nonprofit agency has received to more than $1 million.

“We will invest 100 percent of the money into affordable rental housing,” Hayes said. “All of it will benefit low- and moderate-income individuals and families.”

The investment could enable the agency to provide as much as $1 million in low-cost loans for affordable housing development.

That is crucial in a county where workers often find it difficult to afford a decent place to live.

“This is making possible affordable housing, either getting additional affordable housing or maintaining affordable housing,” Hayes said.

By the end of 2015, the average apartment rent in Orange County had reached $1,834, according to the Orange County Economic Indicators Dashboard. Meanwhile, the median price of an Orange County home recently reached $625,000, The Orange County Register reported in April.

The tax credit was announced recently by California Insurance Commissioner Dave Jones. The department allocates $10 million in tax credits each year to support $50 million in community development investments.

Banc of California is represented on the NeighborWorks Orange County board of directors by Gary Dunn, senior vice president of the bank. Dunn chairs the NeighborWorks board.

Such partnerships are crucial, Hayes said.

“The community really benefits because we get to use those capital dollars for home loans or purchasing or rehabilitating properties, Hayes said.

The mission of NeighborWorks Orange County, with offices in Orange, is to strengthen communities and enhance the quality of life of residents “by promoting housing opportunities, financial responsibility and civic engagement.” It offers first-time homebuyer education and counseling, provides realty services, loans funds to develop quality affordable housing and seeks to build stronger neighborhoods through community-building programs. The nonprofit also owns more than 100 affordable housing units in Orange County.

Steps for Buying a Home if You Have Bad Credit


Are you struggling with bad credit? Do you see your low FICO score as an impossible roadblock on the path to homeownership? At NeighborWorks Orange County, we are here to tell you that homeownership is still possible!  

A low credit score does not close the door on homeownership. 

In fact, we help dozens of families with poor credit successfully achieve the dream of being a homeowner every year. It’s not an overnight process, but there is hope. If you are ready to realize the dream of owning your home, know we have the tools and resources to get you there. 

If you are worried that your credit is limiting your ability to purchase a home, start here:


1) Connect with a Counselor 

Repairing your credit can be an overwhelming process. That’s why we recommend working with our HUD-approved counselors to help you sort through all the pieces. Together, we work through evaluating your credit, and removing errors on your credit report. We also help you avoid making common mistakes that lower your credit, such as opening too many new accounts at once.

Most importantly, we develop a customized credit card action plan outlining your journey to achieving homeownership. This includes specific steps to repairing your credit as well as milestones to reach for your down payment savings. After your session, you will have a clear picture of both where you are today and where you are headed. 


2) Follow the Action Plan 

The biggest take away from your meeting with our counselor will be your action plan. This will establish manageable steps that you can work on over time. But the important thing is to stick to the plan.

When you consistently pay down your bills, you will start to heal some of the damage that lowered your credit score. Additionally, we will help you build in measures to start saving money toward your down payment. It really is a comprehensive plan.

As mentioned, this isn’t an overnight process. Many of the families we work with continue on their plan for 10 to 18 months.


3) Explore Options and Assistance Plans

We offer different mortgage products, grants and programs designed to help families with bad credit realize the dream of homeownership.

To start, we offer the FHA loan. These government-backed loans have less strict guidelines to help our low-to-moderate income clients better qualify for homeownership. This includes lower credit score and smaller down payment requirements.

In addition to the FHA loan, we offer down payment assistance programs. The WISH and IDEA programs match the down payment that a qualified buyer brings to the transaction 3 to 1 for up to $15,000. So if you save $5,000 for purchasing a home, the program will add $15,000 to your down payment. These programs fully forgive all funds after you live in the home for five years.

Our counselors will show you if you qualify for a down payment assistance program.


Start Your Path to Homeownership 

While that may seem daunting today, if you connect with one of our counselors to start your journey, the time will go by faster than you think. When you look at the big picture, it will only be a short time to devote to a very fulfilling goal.

Together we can get you there.

Don’t let the fear of a bad credit score or even a past foreclosure stop you from realizing homeownership. While both are challenges, when you partner with our counselors at NWOC, you can move past them.


Start your journey today


The Ultimate Home Inspection Checklist for Orange County

There’s this euphoric moment for both buyer and seller once the final offer on a home is accepted! You’ve gone through a tedious process until now, as well as several negotiations. You’re ready to close this chapter and transition into the next phase.

Unfortunately, there are a few more steps. Most notable is the home inspection. 

There will be a few more I’s to dot and T’s to cross before it’s all said and done, but this is an important one. Especially if the buyer is financing the home, the lender will require the inspection to process the loan.

Home Inspection Overview

The buyer brings in an inspector, but they will be a neutral, 3rd party evaluating the home for safety concerns. They aren’t looking for cosmetic issues. Their goal is to identify any unsafe issues such as poor electrical wiring or cracks in the foundation of the home.


Overview Checklist

  • Foundation
  • Plumbing
  • Electrical
  • Roof
  • Appliances

While going through the property, if the inspector identifies any additions that have been added, they will alert the Realtor®. The Realtor® will then need to verify that the addition has a proper permit. Lenders won’t finalize the loan if additions don’t have the proper permits.

While the home inspection differs from an environmental inspection, the inspector will look for visible health issues such as mold. This also includes that all smoke detectors and carbon monoxide detectors are working.


For the Home Owner 

When preparing for an inspection, work to make it easy to access all the areas that will be reviewed. This means doing things like removing furniture blocking electrical outlets, making it easy access to the attic, and clearing below the sink.

Hopefully you de-cluttered the home prior to listing, but if you didn’t, now would be a good time to clean out excess items. Additionally, make sure there is a clear path to all the major areas of the home.


For the Buyer

Not every purchase requires a home inspection. Typically, it’s done to fulfill the requirement of the lending company. They want to verify accuracy and condition of the home they are backing through their loan.

Even if your buying situation doesn’t require an inspection for whatever reason, you should still invest in one. For most families, a home is the largest investment you will purchase. Go the extra mile to ensure that it is not only a solid investment; it is also a safe space for your family to be in.

In reality, the inspection is designed to protect the buyer. It’s your professional once over on the property to ensure that what you see is what you get.

As for any issue identified following the inspection, typically the seller is responsible for covering the cost. This can either be them addressing it prior to the buyer moving in or a credit being given at closing.


A Partner You Can Trust

At NeighborWorks Orange County, we are here to be your partner throughout the entire home buying or selling process. We have skilled Realtors® to help you either find the perfect home or to sell yours. Know that by using our services, you not only get the best possible service provider, but the commissions are reinvested back into the community.

If you’re not quite ready to purchase yet, check out our home buying workshops. We work with you at any time during your journey to homeownership.  


Your First-Time Home-Buyer Questions Answered: Who Pays Closing Costs?


When purchasing a home for the first time, there are lots of questions that come up during the process. At NeighborWorks Orange County, we are here to help you through the entire process.

One of the most common questions first-time homebuyers ask is, “Who pays the closing costs?” To help, here is a quick overview of closing costs.

Closing Costs Are Different than a Down Payment 

Perhaps the biggest challenge in understanding closing costs is differentiating between closing costs and the down payment. Before we dive too far into closing costs, let’s do a quick break down of each. Depending on which loan option you chose, the down payment varies between 3-3.5% of the total loan. For example, a 3% down payment on a $200,000 home is $6,000.

Lenders require you to bring money to the table to purchase the home. They want you to have your own money invested into the deal. To learn more about down payments, check out our guide Everything You Need to Know About a Down Payment.

Your closing costs cover all the expenses that come up during the transaction. Purchasing a home is a big investment with several moving pieces. You need to make sure the home is safe and that it’s worth what the seller is asking, apply for a loan, and have help with the paperwork. To make sure you are protected, you work with experts throughout the process. This includes brokers, inspectors, appraisers, and more. The closing costs cover their fees. 

Typical Costs Included

There are many different factors that go into determining the exact amount you will owe in closing costs. Some fees, such as property tax, are determined based on the value of the home. Others are a flat fee. Your realtor and mortgage broker can help give you estimations on a range of fees to anticipate when starting the process of making an offer. Once the seller accepts your offer and you have a final amount for the loan, you can get exact numbers for your closing costs.

Here are typical expenses included:

  • Title company,
  • Appraisals,
  • Title Insurance,
  • Property Tax,
  • Escrow,
  • Origination fees

Every case varies. No two closing fee costs are ever exactly the same. While we can’t guarantee what your final costs will total, typically closing costs range in the 3-4% of the total price of the home.

Who Pays Closing Costs?

It’s standard for the buyer to pay the closing costs.

There are occasional instances that a seller will pay closing costs. That needs to be negotiated and is largely dictated by how strong the market is or how motivated the seller is to sell the home. In the current market conditions, a seller’s market, it’s very unlikely that a seller will agree to pay closing costs.

Especially in a hot market, as a buyer you want to give the seller an attractive offer on their home. Requesting they pay closing costs doesn’t necessarily accomplish that. If they get other offers, most likely the seller will pick one of those. Make sure to work with a good realtor to ensure that you make a good offer when home searching. 


Working With Down Payment Assistance Programs

Many of our clients qualify for one of the Down Payment Assistance Programs.

Two programs, WISH and IDEA, offer 3-to-1 matching funds up to $15,000 to apply toward a down payment. This means if qualifying applicants save $5,000 toward their home purchase, the assistance program will pay $15,000 toward the home.

One of the unique advantages of the programs is that you have the freedom to apply your money to the deal in whichever way makes the most sense for your family. We advise our clients to use the funds they bring to the table on their closing costs. With the assistance program covering the down payment, typically this makes the most sense.

Learn more about the down payment programs out there.

Help Throughout the Process

 Buying a home can be an overwhelming process. There are several moving pieces, and understanding all the requirements can be daunting.

That’s why we invite you to partner with NWOC throughout the process. Starting with our Home Buyer Workshops, we teach you about all the different elements to buying a home. This one-day course prepares you to successfully enjoy homeownership. We also have experienced realtors to help you search for your home.

Contact us today to start your journey toward homeownership!


How Tax Returns Can Help with Homeownership


It’s tax refund season! Every year April brings a frenzy to button up all our tax documents and file our taxes before the mid month deadline. Whether you opt for online software, use an accountant, or qualify for the Volunteer Income Tax Assistance (VITA) program, completing all the tax forms and submitting your financials to the IRS always takes quite a bit of work.

The work comes with a bright side if you qualify for a tax return. In some cases, the refund adds up to quite a sum. According to Smart Asset, the average Californian tax refund is $2,810.

For many families in California, particularly in the Orange County area, $2,810 is a substantial amount of money. That is the equivalent of saving just over $200 a month for the entire year. For some families, saving that amount each month can be incredibly difficult. Many of the families we work with have budgets that are tight as it is. Oftentimes, unforeseen expenses pop up throughout the year that deplete monies earmarked for bigger goals.

Which is why the possibilities of applying a tax refund to a bigger and life-changing goal is so exciting. If you’re joining the nearly 80% of American who receive a tax refund each spring, we would like to invite you to explore how it can help you achieve your homeownership dreams.


Applying a Refund to a Down Payment

There are specific rules around the types of funds that you are allowed to use toward your down payment. The bank wants to ensure that you are able to save funds on your own. This reassures them that you will be able to pay your mortgage each month. Depending on your loan requirements, you will need to meet different minimum amounts that you bring to the transaction.

The good news is that your tax refund is considered money you saved! Technically a refund is money that you overpaid the government during the course of the year. This means that there are no requirements dictating how long your refund needs to be in your account before you use the money.


Using a Refund in Combination with Down Payment Assistance Programs

First-time buyer assistance programs typically require a down payment ranging from 3%-5% of the house value. In Orange County, we live in one of the areas of the country with higher costs of living. A modest two-bedroom family home here can average $350,000. That means a down payment of $10,500–$17,500. While $2,810 is a great start to savings those funds, the entire amount can be a little daunting.

That is where our down payment assistance programs come in.

We offer specific programs designed to get first-time homebuyers into homes by matching funds going toward the down payment or closing costs. If you previously owned a home, but lost it in a short sale or foreclosure, you are reclassified as a first-time homebuyer. This means that you can qualify for down payment assistance programs as well.

Both the Workforce Initiative Subsidy for Homeownership (WISH) and the Individual Development and Empowerment Account (IDEA) programs allow you to apply your tax refund toward a matching down payment grant. Each program matches up to $15,000 in their 3-to-1 down payment grant. To receive the full $15,000 in assistance means that you only need to raise $5,000. While a $2,810 tax refund seems daunting to cover the full 3%-5% down payment, it brings you extremely close to $5,000.

If you need a few months to save the remaining amount, the IDEA program works with individuals and families for up to ten months to save their down payment. If you choose to move forward with your current tax refund, the program would match that amount 3-to-1. With our current refund example, that would be adding $8,430 to your down payment. A $300,000–$350,000 home is within reach!


Being Intentional With Your Refund

According to a Georgetown Institute for Consumer Research 2015 finding, 30% of consumers plan to spend their tax refund by either buying a treat or purchasing something needed. They also noted that individuals who saw a refund as an end-of-year bonus were more likely to spend their refund at a store they typically didn’t shop at. 

This year make an intentional plan on how you can use your tax refund to improve your family’s financial position. For some families, this can be a step toward homeownership. For others, it might be time to pay down debt or save an emergency fund.

If you’re unsure that putting your tax refund toward your down payment is the best financial step for your family, connect with one of our homebuyer coaches. Our experienced professionals at NeighborWorks Orange County are HUD-approved counselors who can help you build a personalized road map toward homeownership.

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How to Calculate Closing Costs


There’s no denying that there are a lot of moving pieces in purchasing a home. As a buyer, you work with a Realtor, a mortgage broker and several other professionals to navigate the nuances. Even with their support, the whole process can be a lot to take in.

All too often buyers come to the final stages only to be sidelined by closing costs.

Especially in Orange County, saving up a down payment is a substantial accomplishment. It can be disheartening to all suddenly realize that there is one more fee you need to address tacked onto the price tag. 

There is a lot of confusion around closing costs. To help prepare you for the process, we are breaking down closing costs and answering your most commonly asked question.

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Difference Between Closing Costs and a Down Payment

The biggest confusion we see is buyers not realizing that closing costs and down payments are different.

Let’s start with explaining what a down payment is. Down payments are a percentage of the loan that you bring to the table when securing a mortgage. With the exception of VA loans, lenders don’t want to write no-money-down loans. This means that the lender is putting down 100% of the funds. Instead, they have the buyer put their own funds into the transaction as well. This gives the lender more confidence in your ability to pay your loan each month.

While many times you hear professionals or other industry experts recommend saving 20% of the entire home loan for a down payment, most providers only require a minimum of 3%-5% down.

Additionally, there are certain requirements on what types of funds you can use toward your down payment. For example, you cannot use gift funds until you have met the minimum requirements. Also, funds must have been in your bank account for two to three months prior to the bank reviewing your statement. These rules help the bank gain confidence in your ability to save money and manage finances demonstrating that you can make monthly payments.

The closing costs, on the other hand, are not about building trust and showcasing reliability to the bank. 

Remember when we started how we mentioned that there are many individuals who help you navigate the home-buying process? These include an appraiser, an inspector, escrow company, and others. Their job is to protect you in your purchase. For example, you hire an inspector to ensure the home is safe and that you aren’t bringing yourself into a situation with costly home repairs.

Closing costs cover their fees.

Here are standard expenses that will likely be included in your closing costs:

  • Title company
  • Appraisals
  • Title Insurance
  • Property Tax
  • Escrow
  • Origination fees

Unlike down payments, closing costs do not have specific requirements on where the money comes from or how long it has been in the bank.


Calculating Fees

Unfortunately, there isn’t a clear-cut formula to calculate your closing fees. It all varies, depending on your provider and the cost of your home. Some fees will be flat fees. Others will be based on the home’s value.

Typically closing costs range from 3-4% of the total value of the home.

If you are purchasing a $300,000 home, your closing costs would likely range from $9,000 to $12,000, a $200,000 home would range closer to $6,000 to $8,000.

Make sure to talk with your Realtor and mortgage provider throughout the process. They can give estimates prior you making an offer on a home. Additionally, there are often options for paying your closing costs. Some mortgage providers give you the option of rolling your closing costs into the total of the loan. Other times providers will carry the closing costs and increase the interest rate on your loan. Individuals who qualify for down payment assistance can allocate their funds toward closing costs, putting the assistance to satisfy their down payment.

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Experienced Professionals to Help You Through the Process

At NeighborWorks Orange County, we are your trusted advisors throughout the process. Our primary focus is to educate and empower families and individuals along their journey to homeownership. We accomplish this through hosting home-buying courses, offering one-on-one coaching and pairing you with service providers with the heart of a teacher. No matter where you are on your journey, we are here to help.

Start with our free home-ownership counseling. Together we can help you establish a game plan towards purchasing your own home.

Buying after a Foreclosure: Homeownership is Possible


There’s no denying that foreclosure is a devastating process to go through, both financially and emotionally. Many times, families lose hope in their ability to ever successfully achieve homeownership again.

At NeighborWorks Orange County, we are here to tell you that homeownership is possible after a foreclosure.

It won’t be an easy journey. It will take time. From a credit standpoint, foreclosure is the most damaging way to get rid of a property. But you can overcome this challenge and become a homeowner again. Here’s how:

Immediate Action Items 

The first step will be to finalize the foreclosure. Once you remove the monthly mortgage hit from your credit report, your credit can start the healing process.

Then you need to assess your situation. We recommend sitting down with one of our counselors for help. The most important goal at this time is to understand what factors led to the foreclosure. Many of our clients face challenges such as a job loss, reduced hours at work, death, or a disability that contributed to the foreclosure. A counselor can help you pinpoint the factors specific to your situation.

More importantly, a counselor can help you create a roadmap to recovery.

All of our work is completed individually. We will never give you a cookie-cutter answer. Consider us part of your team. 

Our counselors start with a financial snapshot of your current situation:

  • What other debt do you have?
  • Was bankruptcy part of the foreclosure?
  • What is your monthly income?
  • What components are straining your budget?

They will work with you to establish a budget. This is essential to financial recovery. They will help you analyze the areas of your budget that are tight, as well as areas where you have a little flexibility. The goal is to be realistic about what you can and cannot afford.

Lastly, our financial experts work with you to identify your goals. Five to seven years down the road, where do you hope to be? Is homeownership part of that goal? Depending on your specific goals, we help to put together steps to achieve them. These also include reasonable timeframes and milestones to achieve along the way.


Rebuilding Credit

Once you start your journey toward becoming financially fit, you can start to address your credit. Our counselors can help you approach your damaged credit. Starting out, you will work on three main aspects:

  • Settling bad debt.
  • Removing mistakes on your credit report
  • Getting current and paying off areas of your debt.

It’s essential in repairing your credit that you have no late payments moving forward.

It Takes Time

Know that it takes time to repair your credit. This will not be an overnight process. In fact, most times it will take years. The more time you can put between yourself and the foreclosure, the better it will be—emotionally and for repairing your credit.

While each program has different requirements, the majority of the time it will be seven years before you can purchase a home.

This gives you time to recover.

As you work through this journey, we recommend working to achieve a minimum of 640 credit score. You will need three lines of credit in good standing that have been open for two years when you apply for a new mortgage. Additionally, you need to have some form of down payment. When you work with our counselors, they can help you find different down payment assistance programs that match your down payment. 

We are here to help throughout the entire journey. You may be starting this journey today. You may be several years in. You may even have worked with our counselors before and became discouraged. Whatever your current circumstances,  we invite you to sit down with them today.


Together we can help you on the path to achieving your goals today. 


A Guide to the Unemployment Mortgage Assistance Program in California


Losing a job is a scary time. The entire experience takes an emotional and financial toll. In many industries, it can take an extended period of time to land a new job. In the meantime, maintaining the ability to stay current on bills becomes a challenge.

Unemployment Mortgage Assistance 

This free program helps individuals who are currently receiving or approved for unemployment benefits pay their mortgage for up to 18 months. Homeowners can receive their full mortgage payment up to $3,000 per month in assistance.

Many individuals facing unemployment don’t think they will qualify for this program if a spouse is still employed. As long as the household income is under $104,650, families with one income can still qualify.

The goal of the Unemployment Mortgage Assistance program is to help keep families in their homes long term. Funds provided are fully forgiven after five years. During the five-year period Keep Your Home California places a lien against the home. Should the homeowners refinance or sell before that timeframe is up, the full balance of received funds from the Unemployment Mortgage Assistance will be due.

The final eligibility criterion is determined by the loan provider. The holder of the mortgage must be willing to accept the assistance as all funds provided will be paid directly to the loan provider. Check out the participating servicers.


Keep Your Home California

Keep Your Home California is part of a larger national initiative that recognizes the hardest hit areas of the 2008 recession, identifying 18 states. To help families in these states during challenging financial times, the federal government allocates funding to The Hardest Hit Fund®.

Each state developed their own unique programs to address the needs in their area. California’s program leverages the collaborative efforts of foreclosure counselors, housing advocates, and community partners working to help struggling homeowners. It specifically targets the challenges created by high unemployment rates in California.

There are three other programs under the Keep Your Home California umbrella. These are not directly tied to unemployment but rather for low to moderate income homeowners suffering a financial hardship. The first is a Mortgage Reinstatement Assistance Program to help qualified homeowners who are behind on their mortgage payments. The Principal Reduction Program helps individuals who owe more on their home than it is worth and are suffering a financial hardship. The last is a Transition Assistance Program. This program helps applicants who are currently going through the short sale process or a deed-in-lieu of foreclosure.

NWOC Can Help

At NeighborWorks Orange County we help individuals and families identify which programs they qualify for and complete their application.

If you are currently struggling to make your monthly mortgage payments, either due to unemployment, financial hardship, a death in the family, or other life circumstance, know that you don’t have to face this alone. We are here to help youidentify your plan of action. We focus on homeownership preservation and ultimately have your best interests at heart.

Together, we can identify programs you may qualify for and identify solutions designed for your unique situation. Make an appointment with our counselors today


Losing a job is a scary time. The entire experience takes an emotional and financial toll. In many industries, it can take an extended period of time to land a new job. In the meantime, maintaining the ability to stay current on bills becomes a challenge.

Breaking Barriers to Homeownership


Charity Burseth knows the meaning of determination. 

She pushed herself to undergo months of physical therapy so that she could walk at her high school graduation.

She moved away from home to go to college at UC Riverside, where she lived independently and obtained a bachelor’s degree in psychology.

In January 2016, Charity, who uses a wheelchair because of a genetic bone condition, achieved her goal of homeownership when she got the keys to a condo in Anaheim that she now calls home and moved in.

“I’m a big believer in the idea that you should not limit yourself,” she said. “Because of my disability, I face obstacles all the time. I’ve always not let those things get in the way. I’ve tried to always do what I can to the best of my ability, like purchasing a home or going away to school. People say, ‘That’s a big thing. Aren’t you scared?’ But if you think like that you won’t do it. You really can’t put a ceiling on yourself.”


Charity, 34, grew up in Huntington Beach and in Long Beach, where she graduated from Jordan High. Charity had been born with osteogenesis imperfecta, a genetic disorder that made her childhood bones brittle. As a result, she suffered some 30 bone breaks, had four surgeries at CHOC Children’s Hospital and in elementary school began using a wheelchair. Yet even as a child, others saw something special in her. As a third-grader, she was honored by the Orange County chapter of the March of Dimes Birth Defects Foundation. 

After high school, Charity was admitted to UC Riverside, where she obtained a bachelor’s degree in psychology. She lived in dorms her first year, then in off-campus apartments.

Following college graduation in 2005, she moved back in with her parents for several years, went to work and began driving in 2007, using a Honda Civic with special hand controls. For about four years, she lived with a series of roommates, but repeatedly experienced the frustration that many young renters do. Over and over, she found herself seeking new roommates and moving from apartment to apartment. In her last apartment, Charity’s split of the rent was $1,045, and she was paying down college loans, too.

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When she got word that she was losing another roommate last spring, Charity decided to look into homeownership. Charity works as bill review analyst for an insurance company. A co-worker told her about the nonprofit NeighborWorks Orange County, which guides low-to-moderate income homebuyers toward their goals of ownership, teaches the basics of financial fitness and offers realty and lending services.

Charity took an eight-hour class in homeownership at NeighborWorks Orange County in August.

“They give a lot of advice in the class,” she said. ”They said you really need to know what you want and what you’re looking for, and to really be sure. It has to be something that you love, and you can see yourself there.”

Within a day or two, she met with a homeownership advisor to determine next steps in her quest to buy a home.  Charity had a good work history and good credit.  NeighborWorks connected her with a trusted Realtor. 


Charity figures she looked at about 10 possible homes. She needed something on the ground floor, readily accessible for a wheelchair. 

After two months, her Realtor located a condo in Anaheim that met Charity’s needs. It was a first-floor unit with a low first step at the entryway, but it also had wide doorways connecting the kitchen, living area, bedroom and bathroom. 

Charity decided this was the place for her. It had a patio, fireplace, stainless steel refrigerator and beautiful hardwood floors.  Built in 1990, the one-bedroom, one-bath condo has nearly 800 square feet. 

The “friendly experts” at NeighborWorks helped her put together a finance package for the $245,000 purchase. 

It included a $57,500 deferred payment CalHome loan, a forgivable 3-1 matching grant of $15,000 through the WISH (Workforce Initiative Subsidy for Homeownership) program for low-income homebuyers, and a $165,000 first mortgage. With her down payment and deposits, Charity came in with more than $10,000. Her final college loan payment was in sight.

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“It’s a big risk,” Charity said of her decision to become a first-time homebuyer. “You’re betting on your future income. I prayed about it. I thought, “My God, this is what I want to do. If You make it possible, all the better.’”

Sometimes in escrows things go smoothly. In Charity’s case, there was a hitch. The sale was supposed to close Dec. 28. Then it was supposed to close Jan. 8. Charity had to be out of her apartment by Jan. 12, or face a rent payment of $149 a day. 

As it turned out, Charity didn’t get her keys until a week after that deadline. But NeighborWorks did something extraordinary. It decided to reimburse Charity for the extra week’s worth of rent payments.

Moving day finally arrived, and friends were on hand to help. The former owners left behind some wall art that said, “Welcome to your new home.” A former roommate gave her a wall decoration that says, “Love makes a house a home.”

Working with her boyfriend of the past two years, Charity added some touches of her own, adding new curtains, new faucets and new doorknobs. Movie videos – and the condo’s two TVs – hint at her interest in watching films, like Disney productions, comedies and the Harry Potter series. 

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She had the walls, which had been brown, painted to reflect her love of blue. They’re a shade of aqua called “Adonis” and a variation of white called “Cotton Blossom.”

Photos of those dear to her and of some of the trips she has made decorate the living room. You’ll see her mom Lorraine, sisters Megan and Autumn, brother David and boyfriend Michael Sy. You’ll see a shot of Charity and her dad Mark at Mt. Rushmore. 

“I feel a sense of accomplishment,” Charity said. “Right now I am really on my own. I am completely independent – officially an adult.”

In addition to her love of movies and travel, Charity has also been an active member of Mariners Church in Irvine, where she has led Bible studies and was involved in a singles ministry.

“I’m grateful to NeighborWorks and to God,” Charity said. “He blessed me to come across this program. I pursued something, and I’m blessed with the opportunity to have succeeded.”

Charity sees her purchase as another milestone in adulthood. She’s looking forward to marriage, and having kids. 

“This is the beginning, a starting off point,” Charity said. “I think it’s definitely a big stepping stone to independence and to the next step – marriage and eventually having children.”


The First Home is a "Blessing"


Paul and Marcela Ramirez wanted a home to raise children. They wanted to settle near their family. They wanted to live near the church where they were married and in Santa Ana, the town where they were born.

With the help of NeighborWorks Orange County, their dream came true in October 2015.

The couple met through a church group in their early 20s, and about a year later, started dating.  They began attending homebuyer classes at NeighborWorks after they got married in January 2013. 

“We knew we wanted a home to raise our growing family, a place where members of our church could come and celebrate,” said Paul, 32. “That’s what we prayed for.”

They heard about NeighborWorks through a friend in their church community.

The most important thing they learned came in their first class – credit. They had no credit history, so they took the advice of the “Friendly Experts” at NeighborWorks and began building a credit history and saving.

“The lesson I learned is that you have credit, but you have to be responsible and you have to live within your means,” Paul said. “To have credit, but to be smart about it.”

Paul, a sixth-grade teacher at Valencia Park Elementary in Fullerton, returned to NeighborWorks for a refresher in 2015. By this time, the couple was ready to become first-time homebuyers.


NeighborWorks showed them an affordable condominium in Buena Park, a beautiful three-bedroom, two-bath home they thought would make a great choice. But their NeighborWorks Realtor saw a little hesitation. 

It wasn’t, Marcela said, in Santa Ana, where they had lived with Paul’s parents.  It was distant from St. Anne Catholic Church, which they attend, and where Paul had proposed to Marcela after a moment of prayer.

Their NeighborWorks Realtor had another house on South Van Ness Avenue in the Santa Ana Memorial Park neighborhood to show them. 

The house had been foreclosed on, and NeighborWorks was acquiring it through the Neighborhood Stabilization Program funding, a program aimed at stabilizing neighborhoods hit by foreclosures.

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It was a mess. The paint was peeling from the blue and white exterior. The ironwork in front of the house was rusted.  A dilapidated shed stood alongside the house.  Even the windows were boarded up. 

It was also smaller than the condo they had seen, with two bedrooms, one bath and 844 square feet. Friends warned them about the age of the house, which was built in 1939.

But it was within walking distance of the church and near family. And it offered a chance to live in a home of their own, free of worries about rent increases and conflicts with landlords over maintenance. 

NeighborWorks acquired the property in January 2015.  Over the next few months, the Ramirezes would stop and check the progress made on renovations. They abandoned any plans to buy the condo.

Crews worked steadily at the Van Ness Avenue house. The plumbing and electrical systems were replaced, and dual-pain windows, central air conditioning and heating were installed.  The foundation was re-enforced. New flooring, paint and a roof brought the interior and exterior to life. The kitchen was remodeled with new white cabinets, a granite countertop and stainless steel, energy-efficient appliances. The dilapidated shed was torn down and a long, concrete driveway was poured.

The overhaul of the house was completed in July 2015.  


Overcoming their reservations about the house’s size, the Ramirezes decided to buy it. 

“I was just ready to be in a house,” Marcela said. “I said we can make it work.”

They qualified for financing aimed at helping buyers earning less than 80 percent of the area’s median income.  The sale closed on Oct. 30, 2015.

Paul, who attended Middle College High School in Santa Ana and went on to get his bachelor’s degree and teaching credential at Cal State Fullerton, looked over every detail of the paperwork. 

“NeighborWorks knows me as the guy who asks questions,” Paul said. The staff always responded.

The couple’s efforts have paid off. Paul likes walking out the door and along a walkway with green lawn on both sides. Marcela, a Santa Ana College graduate and stay-at-home mom, likes the kitchen upgrades and the house’s architectural touches, such as the arched entryways.  Daughter Liliana, age 1, plays with her toys in her room, and with rocks out in the garden. The couple has decorated the home with artwork by Marcela and her mother and with religious icons, like an image of Mary and the infant Jesus. 


”The biggest lesson we learned is just to trust in God, to be patient, and that whether we had the home or not, God will provide,” Paul said.

As the 2015 holidays came to a close, a Christmas tree stood in the living room, Advent candles decorated the dining table and a crèche spread over a console.

The Ramirezes are grateful to NeighborWorks and have told several people about the help it can provide low- and moderate-income households.

“My advice to a first-time homebuyer is to call NeighborWorks,” Paul said. “Buying a home can be overwhelming, but you do not have to do it alone. There are no commitments with NeighborWorks and they will help you from step one to step thirty.”

Marcela, 31, is expecting the couple’s second child in April. Paul is already thinking ahead to the possibility of expanding the house in the spacious backyard, where citrus and avocado trees dot the lawn. They’ve met their neighbors on both sides, and discovered that people on their street look out for each other.

“God has always been good,” Marcela said. “This opportunity for a home has been a grace.”

“It is a blessing to have this home,” Paul said.

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To be continued...


Empowered for Homeownership



Norberto Santana Jr. uses the word often when he talks about his experience buying a home through NeighborWorks Orange County.

He felt empowered, he said, through the mortgage and home-buying coaching he received before purchasing his family’s tri-level condo in Ladera Ranch. He feels empowered to make improvements and repairs on their 1,559-square-foot home as he sees fit, without having to rely on a landlord.

And he says that communities will ultimately become more empowered as a result of homeowners, through NeighborWorks, taking responsibility for their investments.  “I can see how their process works,” he said. “They get people into homes where they are empowered. They are creating more empowered communities.”


Santana Jr, 48, and his wife Amanda, 45, had purchased a home in Orange County before. But the Great Recession struck at a time when they needed to refinance and with credit markets frozen, they sold the property through a short sale. 

The family was renting a home in Laguna Niguel when Santana, the publisher of a nonprofit investigative news agency, began looking for a new place to rent. Fortunately, he found a property in Ladera Ranch that NeighborWorks OC had listed for sale, and it appeared to be affordable. 

The Santanas closed on their two-bedroom, 2.5-bath home in 2015. With their down payment savings, other down payment programs, and a conventional 30-year mortgage.

“There wasn’t a hard sell,” Santana said of his work with NeighborWorks “Friendly Experts.” “It was more like, ‘How can help we you? How can we facilitate the best situation for you and your family? Let’s make sure this is a good fit for you.’"


The Santana family went through the NeighborWorks OC homeownership process, taking an eight-hour home-buying class and a series of mortgage coaching sessions. 

“It was more of a life skills workshop in a lot of ways than just buying a home. That is in a part their business mission. They sit down with you and help you go through your budget. They are not trying to push anything. That to me was an amazing experience.”

From the beginning, staff at NeighborWorks helped to dispel the Santana family’s concerns by providing clear and helpful information, but never pressuring them one way or another. Working with NeighborWorks Orange County, they learned about the ins and outs of credit scores, of different loans they qualified for, even how to spot mold.

“I called them guardian angels,” Santana said. “They are engineered to look out for your best interests.”

Santana said he was impressed by the knowledge and experience that NeighborWorks staff shared with him, down to details like being sure to change garage-door codes, and paying attention to his homeowners association.


“Home ownership can be a dangerous experience,” Santana said. “NeighborWorks pays a lot of attention to not just getting you into the house but to ensuring that you are able to stay in the house, that you know the responsibility that you’re taking on, that you understand maintenance costs. And that you understand the empowering aspects of owning a home.”

The benefits of being in their condo are many, Santana said. Son Maximo has been able to remain within the Capistrano Unified School District at a nearby Spanish dual-immersion elementary school. Amanda’s allergies and asthma have improved, Santana believes, due to the condo’s improved windows, newer air-conditioning system and his ability as owner to install more efficient filters.

“While there is a lot of responsibility, and that makes you gulp,” he said, “there’s a lot of freedom and opportunity.”


Father and son, out for a walk, saw holiday lights going up at a community park, Santana recalled.

“It was uplifting, looking at my boy, watching as they put up lights at the community park,” Santana said. “He realized they will be part of his life, and will probably be a lasting memory long beyond when I’m gone.”

Santana said he feels “incredibly blessed” to have worked with NeighborWorks staff, and to have witnessed their passion for community, family unity and quality of life

“Every neighborhood in America should benefit from this kind of a program.”


The Ultimate Guide to Orange County First-Time Homebuyer Programs


There’s no denying that the home-buying process is complex. Between credit, mortgage applications, and finding affordable housing, there are a lot of moving pieces. 

The good news is that at NeighborWorks Orange County (NWOC), we have the most incredible resources to empower you throughout the entire process.

Together, we will tackle the nuances of your credit score and outline realistic steps you can take to achieve homeownership. While the majority of our services are designed to help you in this process, our comprehensive Homebuyer Workshop will give you all the tools to successfully navigate through the home-buying process. 



What is the First-Time Home Buyer Workshop?

This program digs into the home buying details by going through five different main sections:

     - Credit and Budgeting

     - Lending

     - Real Estate Agent Best Practices

     - Insurance

     - Down Payment Programs

After completing the workshop, you will have a better understanding of what lenders are looking for, finding the ideal realtor, grasp the importance of having the right insurance, understanding the criteria for down payment programs and more!

Both of our in-person and online workshops go through the same material. By offering two different options, you have more versatility to fit the program into your schedule.


Homebuyer Basics (1.5 Hour Course) 

For our clients that are looking for some quick insight without taking the 8-hour workshop, we offer a short 1.5 hour in-person session that gives you the best information to start preparing for the home-buying process. Our Friendly Experts will help you understand how to take the next steps towards homeownership success! You will learn about valuable resources such as down payment programs, housing market updates, and credit tips.


In-Person Workshop (8 Hour Course)

The 8-hour, in-person workshop takes place on a Saturday and also offered on Monday’s. As a HUD-approved Counseling Agency, we bring in industry experts to teach you best practices, industry trends, and cover the basics from each of the five different topic areas. They also teach you how to ensure you are working with a high-quality service provider.

While they are professionals in the industry, they volunteer their time for this course to provide you with objective unbiased teachings, ultimately empowering you through the process.

We are proud to be the only non-profit provider in the county to offer the in-person course in English, Spanish, and Vietnamese. Participants receive a certificate when successfully completing this workshop. 


Online Course (CAL-HFA Only)

For our CAL-HFA clients, in addition to the in-person workshop, we offer an online course through eHome America. This course gives you the flexibility to better fit the course to your busy schedule. You can complete a module, and then come back later to complete another one.

Once you complete the 8 hours’ worth of coursework, a certificate of completion is provided to both the client and lender. We also check in with each of our online clients upon completion to see if they have any questions about the process or next steps.

Why You Want to Take This Course

There are real challenges when it comes to homeownership, particularly in Orange County. That doesn’t mean you can’t achieve it.

Many individuals take this course to satisfy the requirements from their lender. We applaud them for joining us! But we want to encourage anyone looking to purchase a home in the future to join us.

This course is about empowerment and knowledge. The more you know and understand about the process, the better poised for home ownership success you become.

Many individuals who suffered from a foreclosure or short sale earlier in life come through our course. Each one leaves with the resounding comment, “I wish I had taken this course before I bought my first home.”

You have the chance to do just that. 

Additionally, 80% of our participants come to learn more about down payment assistance programs they may qualify for. Even with information so easily accessible these days, the majority of homebuyers are unfamiliar with the different down payment assistance programs that might be available to them and for which they do not know they qualify.  We have residents from neighboring counties, such as San Diego and San Bernardino County, join us for this specific reason.

No matter their motives for attending, 100% of the attendees say they benefited from the course. If you are looking to give yourself the best possible tools on your journey to home ownership, sign up today


Who Classifies as a First-Time Homebuyer

While this may seem like a simple question, in reality it doesn’t necessarily mean someone who has never owned a home before.

If you lost your home to foreclosure or a short sale, you are reclassified as a first-time homebuyer a few years after that process closes. This means you are re-eligible for down payment assistance and other first-time homebuyer programs. Individuals who are in this category are referred to as the boomerang population.


The Holistic Approach

At NeighborWorks Orange County (NWOC), we believe in providing holistic services to walk with you throughout the entire journey to achieve homeownership. Whether you are 20 and newly married or 70 with the zeal to realize the American dream, we meet you where you are on your path.

Our services start with the homeownership workshop, empowering you with knowledge. Then you can sit down with a HomeOwner Coach to identify exactly where you are in the process, creating a tailored plan to help get you ready faster. Next we have a non-commissioned realtor to assist you in selecting the home for your family. And when it comes time to apply for your loan and down payment programs, we offer robust options right here at NWOC. 

This holistic approach stems from our mission to empower individuals on the path to homeownership. Together we can help make that dream a reality for you and your family. 

Warm Holidays in a Home of Our Own


Mike and Jeanette Chappell had looked throughout the summer of 2015 for a house to raise their six children. 

They looked at about eight properties in Cypress, Buena Park, Garden Grove and Santa Ana – houses that were too small, in great need of repair or just beyond their budget. 

Discouraged and stressed out from their efforts, they were about to give up and put off their search for another year.

But a Realtor from NeighborWorks OC had another place to show them in Fullerton. 

They remembered pulling up to the driveway on Santa Clara Avenue, debating whether to go in. 


“Let’s just go in,” Jeanette recalled saying. “There’s no commitment.” 

They overcame their doubts and looked inside.

They liked the character and charm of the house, built in 1956. It had molding around the doorways, wainscoting in the bathroom and wooden floors that creaked just a bit. 

“We had walked into a lot of houses that felt either stale or rundown,” Mike said. “This one just felt like home.”

“We both walked out after looking at it and it felt like a house we could make home,” Jeanette said. “I walked out and I said, ‘I love it.’ There is something about that house. It has so much character. “


It seemed to them that a dream was about to come true.

Mike, 36, and Jeanette, 37, had both attended Westminster High School, a grade apart. After high school, they found 

themselves active in the same Catholic organization.   

They saw each other at events, started dating and got married.  The first of their six children, Miriam, was born 12 years ago. 

The Chappells, whose parents had never owned homes, rented a series of apartments and then a house in Costa Mesa. 


They had concerns, Jeanette said, about the “health and safety” of rentals, about the potential for rent increases and about the risk of being forced to move in the event of a sale.

“One reason we pursued looking into home buying is because renting is very precarious and impermanent and it makes one depend on the landlord,” she said.

Mike, a graduate of UCI, attended a NeighborWorks OC workshop in 2009 after he and his wife searched for programs that helped first-time homebuyers. At the time, the Chappells had four children.

They had become attached to their old neighborhood in Costa Mesa but couldn’t find anything in the area below $400,000 – their price-point.


“We’re in a grey area,” Jeanette said. “My income is above us needing assistance of any sort,” said Mike, who teaches Spanish at Fountain Valley High School, “but below what we’d need to easily go out and save up and easily make a down payment and buy a house.”

Mike decided to take another home-buying seminar at NeighborWorks in June 2015. By this time, there were six little Chappells.

Working with a NeighborWorks OC HomeOwnership coach, they determined what they could afford.

In August, they saw the house in Fullerton, listed at $499,000, which was over their $475,000 budget. 


Worried about the competitive market they faced, they wrote a letter to the owner, who by chance met the Chappells as they were looking at her home.

“We said we were grateful to have met her and to see the space that she and her family had called home,” Mike said.

“And that they loved and took care of and took pride in,” Jeanette said. “And that we would be grateful to be able to carry that on, the love for this house and raising our kids here.”

 Meanwhile, NeighborWorks OC put together a package that would make the house affordable.


The Chappells offered $475,000, but accepted a $487,000 counter-offer, putting together a package that included a $417,000 first mortgage, a $57,500 second from CalHome and a three percent down payment. The CalHome loan, with payments deferred over its 30-year term, made the difference for them. 

“It was a miracle that it worked out,” said Jeanette, a stay-at-home mom who studied sociology and music at Cal State Long Beach. “We literally would not have been able to do this without NeighborWorks OC.”

The sale closed on Oct. 9, 2015.


Dec. 12 marked two months since they had moved in with their six children: Miriam, 12, Leah, 10, John, 8, Audrey, 6, Jude, 4, and Joshua, 1.

Each of the children likes the three-bedroom, two-bath house for different reasons, Mike said.The house, in the Troy High School attendance area, has about 1,220 square feet, a large driveway, a backyard, side yards and a swing set. 

“There are colors on the walls. It’s not all white,” Miriam said. “I like the color in my room. It’s green.”

Mike, who plays guitar, and Jeanette, who plays flute, look forward to their kids filling the house with music and art projects.

Both said the main lesson they learned from their experience with NeighborWorks OC and with home buying is gratitude.

“The gratitude to have that privilege to see that God provides,” Jeanette said.

 “Because of what we learned, the gratitude,” Mike said, “we can appreciate the house in a different way.”


Photographs by Julie Leopo

FHA Loans vs. Conventional Loans: What You Need to Know


If you’re new to the world of home loans, or it has been awhile since you’ve gone through the loan process, the terms FHA and conventional loans may sound foreign or confusing. 

At NeighborWorks Orange County (NWOC), we’re here to help guide you, making the entire home-buying process more accessible and achievable. 

So here are the major differences between FHA and conventional loans. 

FHA loans 

FHA loans are a product of the Federal Housing Administration, which is part of the U.S. Department of Housing and Urban Development (HUD). That’s a really long way saying that FHA loans are government-backed loans. 

The Federal Housing Administration designed these loans with less strict guidelines in order to help families with low-to-moderate incomes better qualify for homeownership. FHA loans can go to applicants with lower credit scores. The down payments are lower that on conventional loans. And the approval process is more forgiving when it comes to time elapsed since a foreclosure or bankruptcy. 

FHA loans allow individuals or families who do not qualify for conventional loans to still qualify for a mortgage. 

In order to make this a reality, the Federal Housing Administration backs these loans. This means that it is assuming the risk with the loan, not the lender. There are a few tradeoffs though. For starters, all FHA loans are required to have mortgage insurance the entire life of the loan. Since these are higher risk loans, the insurance helps balance the risk. 

This protects the FHA against foreclosure or bankruptcy. 

Secondly, there are limits to the amount you can borrow, as well as the type of property you can borrow for. The limits vary by region, but in most regions you will find the “max borrow” loan amount to be less for FHA than conventional loans. Due to the high cost of living, both loans have a maximum of $625,500 for a single-family residence in Orange County. 

FHA loans can only be applied to a home you are going to live in, referred to as an owner-occupied home. This eliminates the ability to apply FHA loans to rental properties, investment properties, second homes, vacation rentals and other acquisitions.    

While there are many advantages for using an FHA loan, for qualified individuals, a conventional mortgage loan may offer a lower monthly payment. However, affordability between an FHA and conventional loan will depend heavily on the mortgage insurance requirement, and how that affects the final mortgage payment. 


FHA requirements at a glance:

  • 3.5% down payment
  • Credit score as low as 500*
  • Lower interest rate
  • Debt-to-income ratio not limited to 40%
  • Shorter timeframe elapsed since foreclosure (3 years)or bankruptcy (2 years)
  • Streamlined refinance 
  • Mortgage insurance required for the life of the loan

*There is no universal guideline for credit scores. The minimum score will vary by lender based on the overlays the bank imposes on top of the FHA guidelines. 

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Conventional loans

Conventional loans are your typical mortgage loans offered by lenders. Because they don’t have special government backing, they have stricter guidelines for qualifying. They will be backed by either Fannie Mae or Freddie Mac.

If you have good credit and 5% or more for a down payment, then this will be the best option for you.

Even though you will likely pay a higher interest rate, most of the time the monthly payment for a conventional loan will be lower because of the impact of the mortgage insurance amount. Additionally, you can typically borrow more than an FHA loan. You will also have more flexibility in the type of property you can apply the loan to.

Conventional loan requirements at a glance:

  • 5% down payment
  • Credit score620 and above
  • Higher interest rate
  • 40% debt-to-income ratio
  • Longer timeframe elapsed since foreclosure (7 years) or bankruptcy (4 years)
  • Traditional refinance
  • Mortgage insurance only required until balance exceeds 80% loan to value ratio (i.e., you pay off more than 20% of the loan)


If you are looking to make home ownership a reality, we would like to invite you to attend our NWOC Homebuyer Workshop. No matter your age, or if you have purchased a home before, this class is for you!

It will walk you through all aspects of purchasing a home, as well as help you determine the best option for you. Together, we will work through your credit, mortgage applications, home selection, and more.

After going through our class, you can be confident in both your decision to buy a home and in selecting which financing option makes the most sense for your family.  

Everything You Need to Know About a Home Down Payment


Down payments can be intimidating, especially for first-time homebuyers. The most common statements around down payments echo in their minds “You must put down 20%” and “I make too much to qualify for down payment programs.”

For any first-time homebuyer, this makes purchasing a home seem daunting. Add to that the expensive home prices in Southern California, and some would-be buyers view homeownership as an impossible dream.

We are here to tell you that is not the case.

While it would be great, you do not need to bring $60,000+ to the table to purchase a home in Orange County. We work regularly with first-time homebuyers to make owning a home a reality.

The most important piece is that you understand how down payments are calculated. To help unveil the mysteries around down payments, we have put together a detailed guide of what you need to know about a down payment.


How is the down payment percentage calculated?

The down payment is based upon the amount of your loan or appraised value, whichever is lower. 

How much do I need to put down?

If you have been wondering exactly how much you need to come up with for a down payment, you aren’t alone. This is typically the first question homebuyers ask when they meet with a mortgage professional.

The minimum down payment needed varies by loan type. Here is the breakdown for three common loan types:

First-time home buyer loans

Conventional loan

Conventional mortgages (meaning it is not guaranteed by a government program) usually require a 20% down payment. However, there are special first-time homebuyer conventional loans that require a low as 3% - 5% down payments.  

FHA Loan

An FHA loan (which is backed by the Federal Housing Administration) requires a minimum 3.5% down payment. 


VA loan

The VA loan (backed by the Department of Veteran Affairs) does not require a down payment.

They do require a funding fee, which is a one-time fee paid directly to the Department of Veterans Affairs. The funding fee ranges from 1.5% to 3.3% depending on the down payment amount, and if the buyer has used a VA loan prior.  VA loans are products only offered to veterans or current members of the military. 

A simple example for down payments amount for a $300,000 purchase price house would break down to approximately:

  • First-time homebuyer special conventional - $9,000 - $15,000
  • FHA - $10,500
  • VA funding fee - $4,500 to $9,900

What if I’m purchasing a home for more than the appraised value?

In a competitive market, you occasionally find sellers unwilling to budge on their listing price despite a lower appraised value. Other times buyers in a multi-bid situation will offer slightly above the appraised value to entice the seller to accept their offer.  More often than not, it’s the final appraisal that comes in lower than expected.

For homebuyers using a mortgage to purchase a home, this situation creates a challenge. The majority of mortgage providers will not write a mortgage for more than the appraised value. As mentioned earlier, a mortgage provider will base the loan amount on the lower number between the purchase price and or the final appraised value, whichever is lower.

This leaves buyers to provide the additional funds out of pocket if they want to move forward with the initial purchase price. 

*Note: NWOC down payment assistance programs will not work with buyers purchasing a home for more than the appraised value.

Can I use “Gift Funds”?

Your ability to save your own funds for a down payment gives a strong indication of your ability to pay your mortgage each month. In order to verify the source of your funds, mortgage providers will typically request two months of bank statements.

If the bank finds any large sums deposited within that timeframe, they will need to verify the source. Depending on the source, this can create challenges for the buyer qualifying for the loan.

Additional money contributed beyond the minimum needed amount can come from gift funds. Gift funds, as the name implies, is money given to you by another individual, such as family. Remember, though, that the down payment cannot come from another loan source - unless you are working with a qualified down payment assistance or other approved program

General rule of thumb: Have your down payment in your savings account for 90 days prior. This way, you will have it listed for the three months the bank needs to review your statements.


Mortgage insurance

Most homebuyers are familiar with the impact that a down payment has on mortgage insurance, which protects a lender in case a homebuyer defaults on a loan. The more uncommonly known fact is that the mortgage insurance requirements vary by loan type. 

Conventional mortgage

Conventional mortgages require mortgage insurance (MI) when the loan-to-value (your total loan amount compared to the appraised value of the house or the purchase price) is less than 20%. Mortgage insurance, when applied to a conventional mortgage, is most often referred to as private mortgage insurance (PMI) as it is provided through a 3rd party.

When your down payment equals or exceeds 20% of the value of the home, PMI is not needed.   

However, there are special conventional loan programs that require as low as 3% down payment and do not require mortgage insurance. 

With conventional loans, you can work with your loan provider to adjust the way that your mortgage insurance is factored in or applied throughout the duration of your loan. 

Depending on how the loan is written, you may have the option of:

  • Qualifying for a special loan program that does not require PMI;
  • Eliminating PMI by accepting a higher interest rate;
  • Eliminating PMI by paying higher closing costs;
  • Paying the PMI insurance up front to eliminate the monthly fees.

FHA loan

Because FHA terms are more lenient, the loan is a higher risk product. To help offset the risk, FHA loans require mortgage insurance on all loans regardless of the down payment percentage. 

VA loan

VA loans do not have monthly PMI or MI requirements.

Down payment assistance programs

For some qualifying first-time homebuyers, there are down payment assistance that programs can help. These programs are designed to make buying a home more accessible to fist-time buyers through additional funds. These funds are grants, loan forgiveness, or simple fixed interest rates to supplement a first mortgage.

*Note: Not every mortgage provider will allow down payment assistance funds to be behind their mortgage product. At NWOC we have established a good relationship with multiple mortgage providers that are familiar with and allow our assistance programs to accompany their loan.


Down Payment Assistance Programs

At NWOC we connect clients with various down payment programs for Orange County residents:

WISH or IDEA program (only one can be used)

The WISH program (Workforce Initiative Subsidy for Homeownership) is a grant that fully forgives funds after the recipient lives in the home for five years.  Should the recipient move out before the five-year time frame, the funds are prorated with 20% forgiven per year lived in the property. Remaining funds will need to be paid back.

The WISH program matches funds the buyer brings to the transaction. They will match funds 3-to-1 up to a maximum of $15,000.  For example, if you bring $5,000 to the transaction, WISH will match with $15,000. If you bring $2,000 to the transaction, WISH will only match $6,000. 

The IDEA program (Individual Development and Empowerment Account) is very similar to the WISH program.  Like WISH, it offers up to $15,000 in 3-to-1 matching funds to be fully forgiven after five years. IDEA is designed for buyers who have not prepared themselves to save the initial $5,000. IDEA works with them to implement a savings plan for ten months to help save the initial $5,000. Then when it comes time to purchase the home, IDEA matches 3-to-1. 

CalHome loan

CalHome is a gap loan with a 30-year term of up to $57,500. It is a 3% simple interest loan that will need to be paid back. The difference between the CalHome loan and traditional loans is that the CalHome product can defer payment and interest while the recipient is living in the home. 

Other down payment programs

NeighborWorks Orange County also connects clients with down payment programs such as the Neighborhood Stabilization Program (NSP) and other products that are created as funding is available. To see the most up-to-date program availability, visit www.nwoc.org 

Down payment assistance qualifications

Each program has differing qualifications. First and foremost, the buyer must be, in most cases, a first-time homebuyer and qualify for a first mortgage. The home must usually be the primary residence for the borrower(s). Typically, the programs prefer applicants with a 620 FICO score or higher, which must satisfy the 1st lender’s guidelines. Depending on the product, there may be certain requirements on the number of lines of credit in your report. Each program has varying lengths of time for a recipient to have recovered from a bankruptcy.

Down payment programs have differing income levels based on the number of people in the family. The income level is based on the household size compared to the Area Median Income (AMI) indicated by HUD each year. For example, applicants for the CAL Home program must have an income below 80% AMI. The qualifying income goes up as the household size increases. WISH income qualifications are slightly lower than CalHome’s, but you can get a general range based on CalHome’s numbers.

Here are qualifying income examples based on an 80% 2015 AMI:

  • Household of 1 - $52,500
  • Household of 2 - $60,000
  • Household of 3 - $67,500

Additionally, programs such as NSP go up to 120% AMI. 

Here are qualifying income examples based on a 120% 2015 AMI:

  • Household of 1 - $78,700
  • Household of 2 - $89,950
  • Household of 3 - $101,200


There are different options when it comes to down payments as well as loan products. The more you can learn about your options, the more achievable homeownership will become.

If you are thinking about homeownership in the future, consider joining one of our Homebuyer Workshops. Our workshops are only $10 - $25 and will walk you through all aspects of purchasing a home. We leave no stone unturned and no question unanswered.

Know that when you go to purchase a home, you will be equipped with the most accurate and beneficial information, ultimately making your home-buying experience a positive one.

Our mission at NeighborWorks Orange County is to strengthen communities. One of the ways we achieve this is through creating innovative housing solutions and empowering families to successfully navigate the home-buying process.

Meet our Friendly Experts


Getting Top Dollar for Your Home: 5 Tricks


Odds are your home is your biggest investment to date. If so, you are like most Americans. That can put the pressure on when it comes time to sell. Whether it is a buyer’s or seller’s market, you want to position your home to bring top dollar at closing.

Here are five tips to help you accomplish just that:

1) Spruce Up the Property

Have you ever noticed a few things about the property that need a little extra attention? Perhaps the door to the kid’s room that squeaks or the faucet that leaks. It’s time to make sure everything is in tiptop shape. While you may no longer notice the loose floorboard or window that doesn’t open all the way, a buyer will. 

Take the time, and money, to make your home look turnkey. Things like a new coat of paint can do wonders to make a property stand out.

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2) Declutter & Depersonalize


When a buyer walks into a home, it needs to feel spacious and invite them to envision their family living there. 

Two things make buyers stop short in that process: excessive clutter and too many family photos. Furniture and decorations should be left to a minimum. They are there to open a prospective buyer’s mind to the possibilities the property has. 

Family photos or overly personal elements make buyers feel as if they are invading your space. That undermines your efforts to entice them to believe this space is their new home. 


3) Staging

If you have moved all your personal effects from the home, then consider hiring a home stager. While you want to give prospective buyers room to imagine possibilities in the home, no furniture becomes the paralyzing blank page of the real estate world. Just like the daunting blank sheet plagues writers, an empty home will paralyze buyers from realizing the home’s potential. 

A good staging company can bring your space to life, bridging the gap for potential buyers. 


4) Curb Appeal

This often overlooked element is actually the first impression homebuyers will get of your property. What will they see as they round the corner on your street or walk up the stairs to your condominium? 

A few strategic planters dressed with colorful flowers or a well-maintained lawn can make home shoppers smile as they walk in the door.


5) Price it Competitively


This is the most crucial element to selling your home. You must price your home competitively out of the gate. With tools like Zillow, Trulia, and a good realtor at their side, buyers today are the most informed buyers to date. 

If you price your home too high, you will scare off prospective buyers. This will then spiral into a vicious downward cycle. You list high. Buyers avoid the property. Time passes. Now buyers avoid it due to how long it’s been on the market. You lower the price. Buyers see a discounted property and submit lowball offers. 

By the time an offer comes in, you will be a desperate seller. Maintain your edge by pricing it correctly when you enter the market. 

Recently, we’ve been seeing price ranges work extremely well. For example, a home that is listed between $450,000-$475,000 attracts a larger range of buyers. The majority of buyers have their own price range. When you present a home with this method, you capture the attention of both the buyer whose top budget is $455,000 and the buyer whose bottom budget line is $470,000. 

Right now we are seeing buyers present offers in the middle of the range, which makes everyone happy.


Ultimate Tip: Use a Realtor

We are all about empowerment and additional value, so we decided to throw in a bonus tip!  When you decide to sell your home, use a Realtor®. They are going to be your guide throughout the entire process. As mentioned above, pricing your home correctly is crucial. An experienced Realtor® can help you set that price. 


There are so many other nuances to selling a home than just pricing. You also have to market it, present disclosures, navigate negotiations and more. When you work with a Realtor®, you are backed by their broker and company. This gives you a competitive edge when going to market.

If you are looking to list your home, consider NeighborWorks Orange County. Not only do we have an experienced team ready to help you throughout the entire process, you can count on them serving your best interests. None of our realtors work on commission. All of them are on salary. We reinvest the commission fees into our community programs. Our social enterprise model gives you the opportunity to better your community when you list your home with us.

We call it a win–win. You get the best service providers for your transaction, and the community sees more beneficial programs. 

4 Tips for Buying a Foreclosed Home in Orange County


Have you ever glanced through homes for sale? If you’re like many browsers, foreclosure status piques your interest. There’s something intriguing about the word.

With the prevalence of foreclosed homes throughout the years, many buyers have gone from browsing to pursuing purchasing a foreclosure. If this is part of your home-buying strategy, here are four tips to make sure your investment is a good one.


1) Secure a Title Report

When considering a foreclosed home, the first thing you want to do is secure a title report. You need to have a clear title to proceed through the sale smoothly. Elements that disrupt the sales process, sometimes making a particular home not worth the investment, can be unpaid taxes, disrupted loan paperwork, complications identifying owner or lien disputes.


Many times the complications and excessive paperwork can add in additional costs to the closing. Depending on the complexity of the state of affairs, a real estate lawyer may be needed to review the documents.

Securing a title report early on in the process gives you the best insights to decide if you want to move forward on the property.


Securing a title report early on in the process gives you the best insights to decide if you want to move forward on the property.

2) Home Inspection

Foreclosures sidestep one of the most important protective measures for buyers—disclosures. Typically a Realtor® and the homeowner are required to disclose everything about the property, from indicating if there has been a death on the property to structural problems to leaks and more. Foreclosures are exempt from disclosures.


The reason is that the seller typically has never lived in the property. Banks are the most common seller in a foreclosure scenario. They take over ownership when the current owner can no longer make their payments.

This heightens the importance of a home inspection, as it is the only insight you have to the true state of the property. Remember that many issues hide within the walls, shadows or pipes of a property.Also consider the previous homeowner. The majority of homeowners foreclosed on are angry about the situation. Oftentimes, they take their frustration out on the property. Occasionally you will encounter an extremely vindictive former homeowner who stuffs trash in the pipes.


3) Interview Neighbors

Due to the lack of disclosures and never getting to meet the previous owners, foreclosures can be a risky investment. To gather as much information about the property, particularly the former owners, interview the neighbors. Ensure that the former owners won’t have any unsavory friends stopping by in the future. You never want to put your family at risk.


4) Gather Options

The prevailing misconception about foreclosures is that everyone instantly classifies it as a deal. That may have been the case a decade ago, but today the majority of foreclosures come out of the gate at market rate. With all the risks and unknowns, it might be better to go with an owner occupied property.

Additionally, the process can extend out beyond a desired timeframe depending on the complexity of the title and liens. 

The more options you have, the better equipped you will be to decide what makes the most sense for you and your family. All things being equal, given the option between a home with disclosures versus a home without, Realtors will always advise you to choose the home with disclosures. 

Reinvest into the Community

If you are looking to buy a home, consider our real estate. Both our nonprofit status and social enterprise model separate us from your traditiona Realtor. First, our Realtors don’t work on commission. As a salaried Friendly Experts, they aren’t in it for the sale. They want to ensure that you make a decision that best fits your needs.

Secondly, we reinvest revenue back into the community through our low cost homebuyer education, free financial services, and community-building programs. At NeighborWorks Orange County, our mission is to strengthen communities. A large portion of that mission is helping families and individuals like you realize homeownership and make Orange County a better home for all. 

A Place to Call Home: A First-time Home Buyer Success Story


In 2012 long-time couple Matt Whipple and Susan Nichols married. Shortly thereafter, the couple struggled to find financial security and a place to make their permanent home. Together, they were determined to support one another and build a stable future for themselves in Orange County.    

Matt, a lighting artist for the gaming industry, found himself struggling to secure steady work that didn’t require him to relocate to another state or endure a grueling commute to a neighboring county. For this reason, they decided to relocate to Orange County after more than ten years of living in Los Angeles.

Susan also faced tough decisions of her own.  Having worked as a Children’s Program Director for over ten years at an art studio, Susan found herself taking a cut in pay for a position at the company’s Irvine location. This sacrifice enabled her husband to be closer to job opportunities in the growing technology industry of South Orange County.

Both had clearly made sacrifices to continue doing the thing they loved most as creative individuals. Despite having only one steady income and with the cost of rents rising, the couple resolved to stop paying $1750 for their two bedroom apartment and become first-time homeowners. While searching for real estate property, Matt and Susan fell in love with a NWOC owned NSP-2 property in Lake Forest, and were determined to make it their home.


In the fall of 2014 the couple took their first step towards homeownership and met with Education and Training Manager, Sahara Garcia for coaching and soon after completed a HUD-approved homebuyer workshop. Even with money saved for a down payment, the couple was only able to afford the property after receiving additional down payment support, including $80,000 from the Neighborhood Stabilization Program.

Surrounded by nature, the Whipples now enjoy all the perks of their own 2 bedroom condo in Lake Forest, including daily walks on the nearby trails and sailing at the clubhouse. “We’re so grateful for this place. We feel like we live in a treehouse!” Susan exclaims.


Proving homeownership can be achieved at any age, the Whipples no longer fear being far behind their family and peers, and have finally achieved not only permanent stability and a chance to build future wealth through their investment, but as Matt explains, “After 20 years of living in California, we finally have a home instead of just a place to live. That’s enormous for us”.  



Photos by Erica Medrano

Welcome to Our Summer 2015 AmeriCorps VISTA Members


What is the AmeriCorps VISTA Program?



As part of the Corporation for National & Community ServiceVISTA is one of three AmeriCorps programs designed to connect people and organizations who are passionate and committed to help individuals and communities out of poverty. 

Summer VISTA members commit to two months of service on a specific project at a nonprofit organization or public agency, for a modest living allowance. They focus their efforts to build the organizational, administrative, and financial capacity of organizations that fight illiteracy, improve health services, foster economic development, and otherwise assist low-income communities.   Many of the best-known anti-poverty programs, such as Head Start, were in part created by VISTA members. 


Madison Schutt
Resident Engagement Associate


Christy Wong
 Brand Development Associate

How will AmeriCorps VISTA Members support NeighborWorks Orange County? 

NeighborWorks® Orange County is committed to enhancing the quality of life of working families. We strive to provide clients with the most current and useful information on financial education and a path to homeownership. Christy will support our efforts in creating materials that will simplify information for clients, as well as refine our brand.

For the past four years, our organization has continued to grow its Community Building Department to support resident-led collaborative groups in three Orange County target neighborhoods.  Madison will help the department grow capacity in establishing resident groups at our multifamily units, as well as continue to grow our community building resident leadership program.