(Mar 25, 2023)
The Chenoa Fund was designed to help homebuyers in the low-to-moderate income groups raise a down payment. In particular, it offers assistance in the form of 3.5 percent of the price of the home you are looking to buy. However, specific eligibility requirements apply when signing up for this program.
If it's your first time considering the Chenoa Fund, you need to know how it works and what is required. This guide covers the basics of this DPA program for Gulf County, Florida residents.
What Exactly is the Chenoa Fund?
The Chenoa Fund is a nationwide down payment assistance program seeking to make homes more affordable. It helps home buyers with low income manage to meet the down payment requirement lenders demand. Like other DPA programs, the Chenoa Fund has its terms.
The CBC Mortgage Agency set up this DPA program to help address the housing crisis in the country. Since its inception, the Chenoa Fund has been expanding its coverage across all states in the US. More homebuyers with low-moderate income but good credit continue to benefit from the assistance.
Cedar Band Corporation is CBC Mortgage Agency's parent company. Its mission is to promote economic self-sufficiency countrywide through programs such as the Chenoa Fund. The entity is also dedicated to transforming the lives of first-time homebuyers thanks to its partnerships with mortgage lenders.
As you prepare to apply for the Chenoa Fund, remember that it isn't affiliated with government-sponsored affordable housing programs such as the FNMA, USDA, FHA, or VA. This means you will sign up for a mortgage with no federal ties.
Advantages of Signing up for this DPA Program
The Chenoa Fund offers homebuyers way more than down payment assistance. When you get qualified, the program will allow you to access pre and post-purchase counseling that will enable you to get the best out of the home purchase. You will also have a chance to enroll in their Borrower Success Program to understand home loans better.
There are monthly check-ins that the Chenoa Fund schedules to allow you to raise any concerns you may have. During these check-ins, you can speak to professional HUD-certified counselors on any issue affecting your homeownership journey. You can also choose a mode of getting support and track lessons learned from the counselors.
The Chenoa Fund gets most of its operational finances internally without relying on the government. It has also set up several incentives and initiatives to offer homeownership opportunities to low-income neighborhoods.
The Chenoa Fund Down Payment Assistance Products
The Chenoa Fund facilitates its fund through three products as a single DPA program. Each product targets unique homebuyer situations and needs. Here's a breakdown of each DPA product and how it may help your situation.
Chenoa Fund™ DPA for FHA Loans
If you have an FHA-sponsored loan and are looking for a DPA product offering 3.5 percent or up to 5 percent of the home's price as assistance, consider the Chenoa Fund DPA for FHA Loans.
This product is designed to help you pay for closing costs, down payment or prepaid items, or all of these items combined. It comes in the form of a forgivable loan with a 30-year term or a repayable loan with a 10-year term.
You have to qualify for an FHA-backed loan first before considering this product. It's also important to satisfy the minimal overlays associated with this product and have a minimum credit score of 600 to improve your chances of qualifying.
The Chenoa Fund DPA for FHA Loans may be appealing if you want to lock in a friendly interest rate on your mortgage. It gives you a golden chance to build equity in your home rather than spending a lot of time saving for the down payment amount during a housing crisis.
The Chenoa Fund DPA Edge Repayable Second Product
While most of the eligibility requirements for the DPA Edge Reparable Second Product are similar to those of the DPA Edge program, you won't have to meet the median income requirement.
You can take this loan as a 5-year repayable second loan with a 5 percent rate or a 10-year repayable second mortgage at a zero percent rate. The lender can also allow you to pay off this mortgage at your chosen time without imposing any penalties.
The Chenoa Fund DPA Edge
The Chenoa Fund DPA Edge has a relatively higher credit score requirement (620) that you need to meet. Your income should also amount to or be less than 115 percent of your area's median income.
Program Guidelines
The program serves homebuyers across the nation except in New York. Its DPA products also offer loans that amount to 3, 3.5, or 5 percent of your home's buying price. You must familiarize yourself with specific guidelines to get the most out of the Chenoa Fund DPA program.
A certified lender will handle the underwriting, appraisal, origination, and review of credit issues before and after closing. They will only approve the loan to help settle down payment on homes such as townhomes, condos, SFR, PUDs, and attached/detached modular homes.
The only DPA product you can use under the Chenoa Fund to cover the down payment of a loan taken to finance a two-unit home is the DPA for FHA loans. And if you are looking for DPA assistance for three or four-unit properties, the Chenoa Fund won't be of any help.
Eligibility Requirements for the DPA Program
Generally, you first need a credit score between 600 and 620 or higher to catch a lender's attention. You must also satisfy the lender-specific eligibility requirements and have a debt-to-income ratio of 45 percent or below.
Since it focuses on increasing homeownership opportunities across the country with good DPA products, signing up for the Chenoa Fund is financially better than renting a house.
The program allows you to buy a property for a lower amount compared to renting an apartment. You need to prove your creditworthiness and income level to qualify for any of the Chenoa Fund DPA loans.
The Down Payment Assistance Percentage Broken Down
As a beneficiary of the Chenoa Fund, you can get a minimum of 3.5 percent of your home's price as a down payment. Depending on the Chenoa Fund product, the DPA will also come as a forgivable or repayable second mortgage loan.
This DPA assistance pairs well with a typical FHA-backed home loan rather than a Fannie Mae conventional mortgage. As a loan, it is originated by an approved lender. In this case, you should choose a lender with a good reputation for offering this type of loan.
You may even pair the DPA product with the seller's concessions to cover the closing costs. However, the concessions need to adhere to FHA's guidelines on the same.
How this Fund Works with FHA loans
The Chenoa Fund is compatible with the FHA-sponsored loan program since FHA loans feature a 3.5 percent down payment requirement. This means you can use the DPA assistance to pay for the down payment on your FHA loan.
With that said, here are ways the Chenoa Fund works with FHA loans.
Chenoa Fund DPA Edge
The Chenoa Fund DPA Edge product usually takes the form of a soft second mortgage since it targets low-income homebuyers. Its DPA comes as a forgivable loan, with no requirement to repay. To enjoy these benefits, your income limit should be less than 115 percent of your area's median income level.
A DTI of 45 percent and a credit score of 620 are the basic things you need to improve your chances of qualifying for this loan. The lender may also be open to adjusting the DTI requirement to a higher value if you have an excellent credit score.
In forgivability, you must repay the loan monthly for 36 months for this incentive to favor your situation. Missing a single payment within a given month of the schedule will prompt the lender to reset the entire timeline. This offers you another opportunity to have your loan forgiven.
Chenoa Fund Rate Advantage
With its high demand under the Chenoa Fund DPA program, the Chenoa Fund Rate offers many perks to borrowers. This product can lock in a reasonable interest rate on an FHA loan. It also comes with DPA, which is 3.5 percent of the home's purchase price.
When using this product on an FHA loan, expect a higher credit score requirement (640) and a lower debt-to-income requirement (50 percent). Your income should be less than 135 percent of the median income level in your area. You also enjoy the loan at a term of 10 years and an interest rate of 8 percent.
Chenoa Fund Edge Repayable Second Product
The Chenoa Fund Edge Repayable Second Product is an excellent option if you want a DPA loan without income requirements.
The mortgage will come in the form of a zero-interest 10-year repayable loan or a 30-year 5-percent-interest repayable loan. To qualify for this mortgage, your credit score should be 620, while your DTI ratio should be 45 percent.
How to Apply for the Chenoa Fund
Applying for a Chenoa Fund DPA loan is simple if you have all your financial documentation. The first step of the loan process is to shop around for lenders that offer this type of mortgage with favorable eligibility requirements. Once you narrow your options to one lender, please familiarize yourself with their loan application process.
Assemble all the documents and information the lender may require to consider you for the DPA loan. Submit them as needed and fill out any forms the lender asks of you. Since the application process will involve some back and forth to verify your details, you should be patient with it.
If the lender is impressed by your application, they may approve you for the loan. Depending on their underwriting policy, it may take a few days or weeks for them to process the loan. But, once processed, it will be sent to your account, allowing you to make the down payment on your dream house.
It's a good idea to check the Chenoa Fund website for more information on the DPA products and approval guidelines. You can also send the program handles an email at info@chenoafund.org for suggestions of certified lenders in your area. If you prefer calling, the number 866-563-3507 will come in handy.
Top 5 Places in Gulf County, Florida to Enjoy a Good Meal
Situated in the panhandle of Florida, Gulf County is a great coastal destination that's part of the Panama City, FL, Metropolitan Statistical Area. It also offers unique dining experiences ranging from seafood to Mexican food from locally-owned restaurants.
Here are the best five restaurants to check out in Gulf County, FL.
Provisions Restaurant & Catering (Port St Joe)
Provisions Restaurant boasts healthy, fresh, culturally diverse foods for all occasions. You can visit the restaurant for seasonal lunch or dinner specials daily.
The joint also accommodates holiday events, wine-tasting dinners, local festivals, and special events throughout the year that can keep you entertained or informed.
Their menu includes the Tomato Basil Bruschetta, Goat Cheese Marinara Fondue served with garlic bread and Artichoke Spinach Dip with grilled garlic bread. Other items include Sesame-Seared Tuna, served with Wasabiyak and Seaweed Salad.
Shipwreck Raw Bar (Port St Joe)
Shipwreck Raw Bar is an excellent restaurant if you enjoy seafood like oysters and shrimp with wine and beer in a relaxed setting. It's neatly set up with friendly staff ready to take your order once you arrive. With its family-friendly aesthetics, the restaurant is accommodating to a group of friends or families.
One meal you wouldn't want to miss at the restaurant is the sauteed crab claws with stuffed mushrooms. You can go to the joint any time of the day, provided they are open for finger-licking seafood cuisines.
Pepper's Mexican Grill & Cantina (Port St Joe)
Pepper's Mexican Grill and Cantina is a casual eatery with a wide range of Mexican dishes on its menu. You can also find vegetarian and seafood options and enjoy the sights of a bar at the eatery. It's a great place to visit for all occasions, including a birthday party and a family night out.
The food at Pepper's is undeniably flavorful, making the restaurant unique from other Mexican eateries. Pepper's is also clean and spacious, with friendly and welcoming staff.
Krazyfish Grille (Port St Joe)
As an excellent, cheery seafood restaurant, Krazyfish Grille features locally-caught fish, craft beer on tap, and tropical drinks. One of the joint's most finger-licking dishes has to be the grilled Florida salad with shrimp. You may also settle for grilled snapper served with plantains and gouda grits.
Overall, the food is yummy, fresh, and hot the way you would want it. The staff members are also courteous and attentive.
Uptown Raw Bar & Grill (Port St Joe)
Uptown Raw Bar and Grill is a laid-back establishment with a menu comprising baked, grilled, steamed, and raw seafood dishes. The menu has an impressively wide selection, whether a family night out or a celebration of your loved one's special day.
Uptown Raw Bar and Grill is a great place to catch up with friends or loved ones over a meal or drink. The drinks at Uptown Raw Bar and Grill are self-service and are available in different flavors. The staff members also respond to orders pretty fast and are friendly.
Summing up
The Chenoa Fund is increasingly changing how people qualify for home loans when the down payment is an issue. As a DPA program, it continues to give hope to low-to-medium income borrowers looking to own homes in the future and build equity without having to save for the down payment amount.
Once you meet the qualifying requirements, you can start your homeownership journey with a DPA loan under the program.
(Mar 25, 2023)
