Unfortunately, owning a home – for most people – is more like a fantasy. Saving for a down payment isn't easy, particularly for first-timers, not to mention today's strict borrowing requirements and soaring prices. A recent study showed that for a median-priced home, it would take an average American's 6½-year savings to raise a 20% down payment.
But despite all these obstacles, not all hope is lost. Luckily, there are programs designed to help potential homebuyers with inadequate finances get around this challenge, and among them is the Chenoa Fund Down Payment Assistance Program.
So, if you're in Osceola County, Florida, or anywhere across the US and need financing to cover the down payment and mortgage closing costs, you might want to consider this program.
So, what exactly is the Chenoa Fund Program? What's needed to qualify? How does it work? What are the program's benefits? This guide will answer these questions and help you better understand whether it's an excellent option. Let's jump right into it.
What is the Chenoa Fund Program?
Run by CBC Mortgage Agency, a federally Chenoa Fund is a countrywide down payment assistance program designed to help moderate and low-income borrowers raise funds for a down payment.
How Much is the Down Payment Assistance Amount?
Typically, qualified applicants of the Chenoa Fund Program receive down payment assistance (DPA) of up to 3.5% of the property's purchase price, depending on the program. This assistance is offered through repayable or forgivable second mortgage loan options.
Money obtained from Chenoa Fund can be used with FHA and Fannie Mae's traditional mortgages. However, the conventional program is currently on hold until further notice.
Home buyers must deal with a qualified "correspondent" lender, as the Chenoa Fund program requires. So, if you're looking to borrow money from the Chenoa Fund, you must pick a mortgage provider from their program's approved lenders list.
The best part is that these authorized lenders have underwriting authority, simplifying their usage of Chenoa Fund products.
Qualified applicants may also combine this assistance with seller concessions (as guided by the FHA) to help cover mortgage closing costs.
"Chenoa Fund is a great way for borrowers to keep their savings when buying a home. By using down payment assistance, they can hold on to their savings for future emergencies, home improvements, or a rainy day," states Miki Adams, the CBCMA executive vice president.
Chenoa Fund Down Payment Assistance Program Requirements
Like most down payment assistance programs, Chenoa Fund Assistance has its share of eligibility requirements that applicants must meet. They include:
One factor that will be considered when evaluating your program's eligibility is your debt-to-income ratio, DTI, which compares your monthly debts to earnings.
Generally, applicants seeking to qualify for the Chenoa Fund assistance must have a DTI not exceeding 50%. This means that you should not have your monthly debts being more than 50% of your monthly pretax income.
Your credit score is another factor when qualifying for the Chenoa Fund program. Usually, a FICO score of 640 is the required minimum to be deemed eligible, although the score may vary with the lender, with some allowing for lower credit scores.
So, suppose you wish to apply for the Chenoa Fund program but have a low credit score, it would be best to consult a competent mortgage expert for further information.
Another critical factor that lenders consider when evaluating your eligibility for the Chenoa Fund DPA. Understanding that income limits vary by location and household size is essential. Therefore, you might want to check the income limits for the specific program you're looking into.
Borrowers must ensure that their household income doesn't surpass the Area Median Income, which in our case is Osceola County.
How Chenoa Fund Down Payment Assistance Works with FHA Loans
Borrowers using the Chenoa Fund DPA for an FHA loan can get either 3.5% or 5% down payment assistance. You can leverage this assistance to finance the down payment, prepaid items, closing expenses, or a combination of these three. It could take the form of a forgivable 30-year term or a repayable 10-year term.
To cut it for Chenoa Fund Assistance for FHA loans, the applicant must meet FHA loan overlays and Chenoa Fund's minimal product requirements, one of which includes a FICO score of roughly 620.
This package could allow you, the borrower, to lock the initial loan at a market-comparable rate. Furthermore, while the DTI ceiling is solely capped by AUS clearance, borrowers with AMIs less than 135% and lower DTI scores are eligible for better pricing.
How Chenoa Fund Down Payment Assistance Works with Conventional Loans
Unfortunately, the Chenoa Fund down payment assistance for conventional loans is currently inactive and has been placed on hold until further notice.
But if it were to return, you can take advantage of the product to obtain financing worth 3.5% of the buyer's price.
However, unlike the former product (Chenoa Fund Assistance for FHA loans), you can use the down payment assistance for conventional loans to cover a part of the closing fees — but that's only after covering the down payment in full.
Chenoa Fund's conventional loan DPA is utilized with two Fannie Mae programs - the standard traditional 97% LTV mortgage and the HomeReady Mortgage.
Chenoa Fund Program Guidelines
All loans offered should be underwritten and closed as guided by compliance with Fannie Mae or FHA guidelines unless otherwise advised by CBC Mortgage Agency published overlays.
Below are some extra vital points about the Chenoa Fund Program you ought to have at your fingertips:
Second mortgages under the Chenoa Fund program are available everywhere across the US, except for New York.
Depending on the borrower's chosen DPA product, the Chenoa Fund program will offer a 3% or 5% second mortgage aid.
According to TRID, lender and origination costs must adhere to the 3% Qualified Mortgage (QM) points and fees rule.
CBC Mortgage Agency must buy the first mortgage.
Your Direct Endorsement (DE) underwriter should be in charge of underwriting the file (both appraisal and credit) and granting final clearance to close the loan, after which your lender proceeds to close the loan.
Approved property types include modular homes, condos, detached and attached single-family residences (SFRs), townhomes, and PUDs.
Two-unit properties are only permitted through Chenoa Fund DPA for FHA loans. No product allows 3- to 4-unit properties.
Manufactured homes can only be permitted under specified FHA conditions.
- Some products allow HPML (Rebuttable Presumption), but not high-cost loans.
The Upsides of the Chenoa Fund Down Payment Assistance
Over time, the Chenoa Fund DPA program has proven one of, if not the best, down payment aid schemes available.
To give you a clear idea of what this program offers, here are some of the many advantages of leveraging Chenoa Fund Down Payment Assistance:
Option for Deferred Payment
The Chenoa Fund Program is kind enough to provide a deferred payment plan - it gives you an option to defer your monthly loan payments for the first five years, after which you can start repaying the loan. For this reason, it is an ideal option for people without money to begin making payments.
An Interest Rate of 0%
You read it right; there is no interest charged on Chenoa Fund DPA loans, meaning you won't be required to pay any interest for the duration of your loan's term – pretty impressive.
After all, paying interest while also trying to save money is the last thing you want to do. Luckily, that won't be an issue if you leverage Chenoa Fund down payment assistance.
There is no Prepayment Penalty
Unlike other programs, Chenoa Fund will not penalize you if you decide to refinance your mortgage or sell your house and repay your DPA loan too early.
This is a clear advantage as you can sell your home without fretting about incurring the fine for prepaying your loan.
Lenient Credit Requirements
It's no secret that many would-be homeowners face credit difficulties, significantly affecting their chances of qualifying for down payment assistance or a mortgage.
For Chenoa Fund, however, borrowers enjoy lenient credit requirements, making the program a perfect go-to option for applicants with not-very-good credit. Borrowers with credit scores of 640 can easily qualify, although other lenders are sometimes flexible enough to accept as low as 600.
Down payment aid schemes tend to be more than often only accessible in a few regions or states. Luckily, that's not the case with the Chenoa Fund Program, which you can access from any state, Florida included – except New York.
So, suppose you like the idea of getting a house in Osceola County, this program might be the one for you.
Homebuyer Education Is Beneficial
All Chenoa Fund applicants must take a homebuyer education course to help them learn and comprehend the home acquisition process before obtaining the loan.
Sure, the course could initially appear inconvenient, especially if you're trying to purchase a home as quickly as possible – but you may be surprised by how helpful it can be. After completing the course, you will be in a much better position to avoid amateur home-buying missteps and make well-informed choices regarding buying your house.
How to Apply for Chenoa Fund Down Payment Assistance
Chenoa Fund Down Payment Assistance can only be issued through a Chenoa Fund-approved lender. Fortunately, applying for the program is nothing but a simple and smooth process. The steps for applying are as follows:
Complete a Homebuyer Education Course - As earlier mentioned, all Chenoa Fund borrowers must complete a Homebuyer Education course before being granted assistance.
Shop for a Chenoa Fund-Approved Lender - These third-party mortgage lenders participate in the program to help eligible borrowers access Chenoa Fund assistance. Visit the Chenoa Fund website to access the official list of Chenoa Fund-Approved lenders.
Get Pre-Approved - The next thing is to seek a mortgage pre-approval to get an idea of the amount of interest you'll need to pay (if any) and your budget. And considering that the Chenoa Fund can only work with FHA mortgages at the moment, you might want to ensure you get an FHA loan pre-approval.
Shop for a Seasoned Realtor - Assuming you've already landed a Chenoa Fund-Approved lender, the next thing is to look for a seasoned realtor in Osceola County, Florida, with previous experience in the Chenoa Fund program.
Look for a Chenoa Fund-qualifying Property - As earlier stated, Chenoa Fund can only cover specified property types, which is why you must ensure the property you wish to acquire is eligible. With a competent realtor's help, looking for a Chenoa Fund-eligible property should be a breeze.
Make an Offer for the Property - After locating an eligible property, feel free to make an offer. If you come across a property whose price exceeds the Chenoa Fund county limit, try your best to bargain with the seller. Fortunately, your realtor will help you through this stage.
Apply for the Chenoa Fund Program - After making an offer, go through the DPA application process and send your application to your lender. You may be required to present specified documentation such as proof of homeowners insurance and copies of the listing agreement, earnest money deposit check, and sales contract.
Proceed to the Chenoa Fund Approval Process - After submitting your Chenoa Fund application, the lender will evaluate your eligibility – whether you qualify for assistance and if the property you're looking to buy satisfies the program's guidelines.
- Receive Down Payment Assistance and Close the Loan - Assuming everything goes well and you get approved for the program, your lender will receive the funds, which he'll disburse after you close the loan.
The Best Restaurants Offering an Acai Bowl in Osceola County, Florida
An acai bowl makes an ideal cold tasty treat to see you through the ever-blazing Florida heat. And if you are looking for the best restaurants offering an acai bowl in Osceola County, here are 5 excellent prospects.
Tasty Lemon Acai Bowl & Juice Bar
Located at West Vine Street, Tasty Lemon Acai Bowl & Juice Bar is a gem. It's one of the ideal destinations to grab a fresh, delicious, and tasty acai bowl that you can consider arguably the best in the area.
You have four options to pick from, including premium, classic, regular, and petite, and you can also try out other of their treats, from artisan lemonades, smoothies, frappes, and more.
Frutta Bowls is yet another superfood café offering the best quality and healthy acai with an array of toppings, from Nutella to pineapple, strawberry, granola, and more.
It's an ideal spot to help you cool down after a sunny day on the beach. And as you'd expect, you have several options to pick from, so be sure to get your buds satisfied.
Canoe Creek Nutrition
Those that have been to Canoe Creek Nutrition can agree that healthy can't taste any better. There are all kinds of treats here, from waffles, shakes, and protein doughnuts to what might be one of the best acai bowls in town.
Situated at East Vine St, Kissimmee, Frappe Artesanal is a notable restaurant with a mouth-watering menu offering plenty of delicacies.
Their Variedad de Acai Bowls are one of them. Besides their acai, the restaurant also offers Keto smoothies, ice cream, and all kinds of frappes.
If looking for a smoothie store with a unique menu, there is no need to look past Planet Smoothie. Having been in business since 1995, it has everything you crave to satisfy your sweet tooth, from great-tasting smoothies and acai bowls that you can count on to keep you going through a hot day in Kissimmee.
Set to Live in Osceola County, Florida?
Becoming a homeowner feels excellent, no doubt. And as we've seen through this piece, buying a home is no longer a fantasy but a dream within reach, especially if you qualify for the Chenoa Fund Down Payment Assistance Program.
You get to enjoy assistance with lenient credit requirements, zero interest rates, and forgivable loan options, allowing you and your loved ones the opportunity to taste Osceola County's offerings.
So, apply for Chenoa Fund down payment assistance today and watch your home ownership dream become a reality!