How to Become a Participating Lender
The City of El Cajon and El Cajon Housing Authority require that all potential applicants be pre-qualified through Participating Lenders. Participating Lenders receive all of the documentation necessary to submit a 2nd mortgage package to the City for review. All City/Housing Authority FTHB Loan requests must be submitted or funded by a Participating Lender.
To become a Participating Lender, an interested company must complete the following process:
1. Have all lending personnel involved with City/Housing Authority Programs review the program policies and procedures in the First-time Homebuyer Program Manual and Bulletins.
2. Return a signed/dated Lender Participation Agreement.
3. Sign and return the Loan Quality Commitment Policy Page (refer to page 30 of the Program Manual).
4. Provide copies of appropriate licensing from the State of California.
5. Provide a $250 application fee payable to the City of El Cajon.
The Participating Lender review and approval process takes approximately (2) to (3) days. Once all documentation is received and approved, the Lender will then be sent a welcome letter and will be placed on the Participating Lenders list that is provided to all interested citizens. An annual renewal fee of $100 is due each January 1st to continue participating in City/Housing Authority programs.
First-Time Homebuyer Program Manual
First-Time Homebuyer Program Manual approved 3/12/2013
The First-Time Homebuyer Program Manual may be amended from time to time. For the most recent program updates, please see the Program Bulletins or call (619) 441-1710 for more information.
Program Bulletins (all bulletins are in PDF format)
City of El Cajon/El Cajon Housing Authority
Subordination Requirements (All programs*)
This City of El Cajon and El Cajon Housing Authority will subordinate FTHB and Single-Family Rehabilitation Loan Program loans under the following conditions:
FHA, VA, Conventional, no cash-out refinances where there is a reduction of PITI and an improvement in loan terms. Impounds on the new first mortgage will be required. The new 1st mortgage loan amount cannot increase beyond the 1st mortgage balance at purchase, or current 1st mortgage balance plus $5,000 for closing costs and impounds, whichever is less. In addition, the City/Housing Authority will not subordinate to negatively amortizing, prepayment penalty, reverse mortgage loans, or financing subordinate to City/Housing Authority liens.
All refinance loan proceeds must be applied as a principal-reduction payment to the City/Housing Authority’s loan balance.
If the payoff of the 1st mortgage has a remaining interest rate buy-down balance currently in escrow, those monies must be applied to the payoff balance at close of escrow and may not be refunded to the borrower.
If the Borrower is required to make payments on an existing City/Housing Authority loan and those payments are currently in arrears, the Borrower must pay all outstanding monthly or other amounts due up to and including the month of issuance of the requested Subordination Agreement(s).
In the event an exception to these Subordination Requirements is requested and granted, the City/Housing Authority may require execution and recording of a Loan Modification Agreement, including any/all other applicable documentation necessary for approval, through close of escrow.
If loan terms change after a Subordination Agreement has been issued to the refinance Lender, Escrow Company or Title Company, there will be an additional fee of $50.00 for re-review of the proposed loan terms and issuance of a second or each subsequent Subordination Agreement.
Send All documentation to the City/Housing Authority as follows:
The City/Housing Authority will review the above documentation for compliance with existing guidelines and will generally render a decision within 7-10 business days of all requested documentation. A Subordination Agreement and any other applicable documentation will be issued by the City/Housing Authority and will be forwarded to the escrow company with specific instructions for compliance, unless instructed otherwise.