Pleasanton DALP Terms and Preferences
Minimum & Maximum First Lender Loan Amount
The 1st lender loan cannot be less than fifty percent (50%) and greater than 97% of the purchase price of the property. A 1st loan amount may be as high as 99% of the purchase price if the PDALP participant utilizes subsidy grant from a City-approved source.
Program Ownership Requirements & Guidelines
The below stated ownership requirements will stay in affect and be enforced by the City until the DALP loan has been paid back in full by the owner/borrower.
Program Eligibility Requirements
PDALP participants must meet the following program eligibility requirements:
- Must be a first time homebuyer.
- Gross combined household income must not be greater than the maximum median income allowances.
- Meet program financial capacity requirements.
- Complete a HUD-approved homebuyer education course.
- Must be a permanent, fulltime resident of the property they purchase; the property may not be rented out.
- Preferences will be given to DALP participants that either work and/or live in the City of Pleasanton to apply to the DALP.
PDALP Loan Terms
Terms of the PDALP loan are:
- The principal and interest (shared appreciation) on the loan is payable when any one of the following occurs:
- At the completion of the term of the loan – 30 years.
- Sale of the property.
- Non-exempt transfer of title.
- Cash out refinance - a refinance in which the principal amount of the new 1st mortgage loan exceeds the balance of the existing 1st mortgage loan.
- Default of any of the terms in the Loan Agreement – including and not limited to the rental of the property.
- At the completion of the term of the loan – 30 years.
- No prepayment penalty.
- Interest for the loan is paid in the form of shared appreciation. Shared appreciation represents the percentage relationship between the purchase price and loan amount provided by the DALP. The shared appreciation allocation is calculated by dividing the dollar amount of the DALP loan provided, by the purchase price of the property. For example a $60,000 DALP loan on a $600,000 purchase price would represent 10% ($60,000 / $600,000) shared appreciation allocation assigned to the loan.
- The DALP borrower will be required to share in any profit generated at the end of the DALP term. The level of profit realized by the borrower/owner is determined by either the market sales price of the property or through an appraisal provided by a licensed appraiser. The DALP borrower will be required to apply the percentage portion of their shared appreciation allocation to the profit generated as an interest payment on the loan. An example of shared appreciation repayment is provided below:
Program Parameters
Program Preference Bonus Points
1 bonus point for household that is:
- Single parent
- Disabled person in household
- Pleasanton resident for greater than seven (7) years
1 additional bonus point provided for a household who has a member that is:
- Program eligible 1st responder who works in Pleasanton
- Pleasanton Unified School District or private school employees
- Public employees of City and/or County governments
Disabled Person is defined as a head of household who has a medically documented permanent physical or mental impairment that prevents him/her from maintaining full-time regular employment. Any individual claiming Disabled Person status must submit verification from a licensed doctor of his/her disability and its effect on the ability to maintain full-time employment. A Disabled Person shall be assigned a number of points as if the person was employed regardless of the Disabled Person’s employment status, plus one bonus point. If an individual has a disability that substantially limits one or more major life activities and has a medical record of such impairment but the disability does not prevent the ability to maintain full-time regular employment the individual shall be assigned the appropriate number of points as detailed in the City’s Preference System in place at the time. Examples of a disability include limitations on caring for oneself, performing manual tasks, walking, seeing, hearing, speaking, breathing, or working.
Pleasanton Employee is defined as a person who at the time the Eligibility and Financing Application is submitted for review, is permanently and continuously employed on at least a half-time basis (i.e., 20 or more hours per week) at a business that is physically located within the then current incorporated area of the City of Pleasanton. Telecommuting or working from an address located in Pleasanton for an employer not located in the City of Pleasanton, as defined above, shall not qualify as employment in the City of Pleasanton, unless the employer is providing the workspace in Pleasanton as part of its corporate/company offices. For persons who are retired at the time of application, the applicant’s work history immediately prior to the date of retirement shall be considered in determining the length of employment in Pleasanton. The City will require applicants to submit pay stubs, W-2 forms, tax returns, or other satisfactory evidence as proof of employment at a Pleasanton business. Length of employment shall be calculated from the final date for submitting a City Eligibility Pre-application. “Employment” does not include volunteer work or any work without reportable income.
Single Parent Head of Household is defined as a biological or adoptive parent or guardian having legal and physical custody of a child under the age of 18, who will be living in the affordable home.
Pleasanton Resident is defined as a person or household who at the time the Eligibility and Financing Application is submitted resides permanently and continuously at a residential address which is physically located within the then current incorporated area of the City of Pleasanton and where that location is considered to be the household's permanent place of residence. The City will require applicants to submit a driver’s license, voter registration, utility bill, or other evidence as proof of residency in Pleasanton.
For persons who moved away from the City of Pleasanton less than 6 months prior to the final date for submitting a City Eligibility Pre-application and who resided in the City of Pleasanton continuously for at least ten (10) years immediately prior to moving away, the residency history prior to the date of moving away shall be considered in determining the length of residency.
In addition to the above, “Pleasanton Resident” includes individuals who have maintained a permanent address in the City of Pleasanton while a full-time college student at a university located outside of the City or while an active member of the armed forces. Proof of residency and academic and armed forces standing will be required.
Proof of Pleasanton residency is required and must be provided through the submittal of rent receipts or utility billing in the name of the applicant. In unique situations, the City may consider other documentation sufficient to determine residency, on a case-by-case basis, such as a notarized statement from a landlord or relative attesting to residency, if the above information is unavailable.
Financial Capacity
Down Payment and Closing Costs – Program participant households must demonstrate the financial capacity to purchase a home, including existing funds in their savings, checking, and investment accounts to apply towards a minimum of 3% down payment and an additional 2% of the purchase price for closing costs and reserves. The 3% down payment requirement may be reduced to 1% if the borrower/buyer combines and layers an additional City-approved subsidy loan/grant program with the purchase and financing of their home. Examples of additional approved subsidy programs include and are not limited to the WISH program and individual grant programs provided through City-approved first mortgage lenders. Participants may receive gifts from first degree relatives (including grandparents). The relative must show proof of seasoned funds in an existing financial institutional account and provide a gift letter.
Credit Capacity – All household members that will be placed on the City’s loan must have the credit capacity and worthiness to purchase a home, including maintaining a median FICO score for all non-dependent household members that is not less than 660. All non-dependent household members must have their name on title.
Financial Stability – All non-dependent household members will be placed on the property’s title and DALP loan. All non-dependent DALP participating household members should have the financial wherewithal, including maintaining stable income and being approved for a first mortgage loan by a City approved lender to purchase the property.
Title Transfers
All title changes and transfers must be approved by the City. In general, there can be no changes and/or transfer in title. Exceptions for title changes include the addition or removal of a spouse and/or registered domestic partner, and a change in ownership due to a death in the household. No co-signors are allowed for the first mortgage loan or the DALP loan. The above referenced title transfer exceptions must be approved by the City, prior to the household conducting a change in title.
Maximum City DALP Amount
The City currently has $300,000 in funding for its 2021/22 DALP funding allocation Cycle (ending on June 30, 2022). Program participants will receive the lessor of $100,000, or the minimum PDALP funding assistance required, per parameters listed below to purchase an eligible property.
Occupancy of Home
A home purchased with Pleasanton DALP may not be purchased as a rental property. Owner(s) must occupy the home as their primary full time residence. The property may not be rented out.
First Time Homebuyer
Applicants must not have had a partial or whole interest and/or maintained title in any real property for three years prior to the date they submit their PDALP Lottery Application.
Property Condition
A property purchased with PDALP assistance must be in good condition and may not have any outstanding Section 1 items, as noted on a licensed termite/pest inspection report. The City requires that a property inspection reports conducted by a licensed property inspector and licensed termite/pest inspector be submitted to the City for review prior to approving the use of DALP funds to purchase the property.
HUD-Approved Homebuyer Education
All non-dependent household members on title must complete and receive a certificate of completion from a HUD-approved (United States Department of Housing and Urban Development) homebuyer education course to participate in the PDALP. The certificate is not required to submit a PDALP Lottery Application.
Maximum Median Income Allowance
Total household gross income may not exceed 120% of the Alameda County’s area median income; adjusted for household size; and per 2021 guidelines published by the California Housing Community Development Department (CHCD). Maximum income as adjusted for household size is depicted in the matrix below:
Household size:
1 person = maximum of $105,500
2 people = maximum of $120,600
3 people = maximum of $135,650
4 people = maximum of $150,700
5 people = maximum of $162,800
6 people = maximum of $174,850
7 people = maximum of $186,900
Household size will include all individuals that will be occupying the property. All dependents listed by the household must be claimed on a 2020/21 tax return as a dependent. Gross income will include income from all non-dependent household members who are over the age of eighteen (18).
Maximum Purchase Price
The PDALP does not assign a maximum purchase price for the property; however, the maximum subsidy provided by the City cannot be greater than $100,000 or 20% of the property purchase price, whichever is less.
Program Lottery Participation Preferences
The City has established Program Preferences for all applicants that will be entering the DALP lottery.
Preferences are provided to households who:
- Live and/or work in the City of Pleasanton
- Work as first responders in the City of Pleasanton
- Work as an educator
- Single parents
- Households with a disabled person
The base preference point system is illustrated below. All categories (Work, Live, Live and/or Work, etc. reference living/working in the City of Pleasanton):
The Application Period has Ended.
Applications were due March 23, 2022 at 5:00pm.
Program Objectives
The objective of the Pleasanton First Time Homebuyer Down Payment Assistance Loan Program, hereinafter referred to as the PDALP, is to promote and increase the capacity for low to moderate income first time homebuyers to purchase a home in the City of Pleasanton (hereinafter referred to as the City). The PDALP expands the purchase capacity for eligible homebuyers by lowering homeownership costs primarily by decreasing the first mortgage amount and payment for a first time homebuyer.
An illustration of how the PDALP reduces mortgage costs is provided below:
City of Pleasanton First Time Homebuyer Down Payment Assistance Loan Program
Household Size Versus Bedroom Size Requirements
The following minimum and maximum household size requirements apply for all applicants:
1 bedroom = minimum 1 person in household, maximum 3 people in household
2 bedroom = minimum 2 people in household, maximum 5 people in household
3 bedroom = minimum 3 people in household, maximum 7 people in household
4 bedroom = minimum 4 people in household, maximum 9 people in household
Minimum & Maximum Housing Ratio Requirements
Maximum PDALP subsidy amounts are determined by minimum and maximum housing ratios designated and applied by the City. Housing ratios are calculated by dividing the gross housing costs derived by the 1st lender by gross household income. Housing costs include the combined total of principal, interest, insurance, home owners association, and property tax payments. Housing ratios may not be less than 28% and cannot exceed 40%. Higher ratios may be considered with down payments exceeding the 3% minimum, higher FICO scores, and the availability of higher liquid reserves.
Refinancing
PDALP participants must secure approval from the City prior to refinancing their first loan to subordinate the PDALP loan behind the new 1st mortgage loan. Cash out refinances will require the PDALP participants to repay the loan in full.