If you are excited about purchasing a home but are short of funds, you can apply for various loan programs to help you get the funds you need. One such program is the Chenoa fund down payment assistance. This program helps aspiring homeowners get the funds needed to make a down payment and cover closing costs.
Down Payment Problems
The mortgage industry looks for ways to make the home buying process easier for prospective homeowners. However, the primary issue with the process is that it requires lots of funds for various expenses, including closing fees, renovations, and down payment.
The FHA allows applicants to use gift funds to cater for the minimum 3.5% down payment; however, this strategy isn't efficient for most moderate and low-income families. Alternatively, buyers can opt for a seller-funded down payment program. But this increases the home's total price, placing homebuyers in mortgage debts they can't sustain.
The Housing and Economic Recovery act passed in 2008 prohibited such practices, but it left a void in funding that buyers needed. Luckily, prospective homebuyers have Down payment Assistance Programs that can provide the much-needed funds to help smooth the home-buying process, making it easier to purchase homes.
The Chenoa fund down payment program provides eligible applicants up to 3.5% of the purchase price, which can cover the entire down payment if you apply for an FHA loan. The program is meant for creditworthy individuals with a low to average income. Applicants applying for conventional loans aren't eligible for the program.
What is the Chenoa Fund Program?
The Chenoa fund is a down payment assistance program that provides financial aid to qualifying families that want to purchase a home. The CBC mortgage agency covers the program and provides eligible applicants with 3.5% of the home's purchase price for a down payment as a second loan.
Applicants eligible for the loan should have applied for and qualified for the FHA loan. The amount of cash the Chenoa funds program helps the applicants cover the 3.5% down payment required for the FHA loan program eligibility.
The down payment assistance program offers a second zero-interest mortgage for a 30-year term. The second mortgage is forgiven if you make 36 consecutive payments on the first mortgage on time. However, making one late payment resets the timer, and you'll have to wait for another 36 months.
Borrowers that don't meet these requirements owe the CBC mortgage agency the loan total amount at the end of the 30 years. However, due to the current economic status where borrowers keep losing jobs, the CBC mortgage agency assures borrowers who've lost their income will not miss out on this feature.
As stated earlier, the program ensures homebuyers reach their required minimum when purchasing their primary residence through the FHA program. You should expect to sign a note and deed of trust for the Chenoa fund as secondary financing.
The Chenoa fund financing provides funds to cover closing costs, required down payment, prepaid terms, or a combination of the three. Borrowers can combine additional funds like monetary gifts.
How to apply for Chenoa funds
If you qualify, you can apply for Chenoa funds down payment assistance through approved correspondent lenders. The CBCMA provided down payment assistance financing under Fannie Mae, partners, and the FHA's guidelines.
Chenoa Fund Requirements
While the first mortgage has its terms, the second has three primary requirements. For starters, borrowers should have applied for and qualified for the FHA loan program.
Additionally, they should fall within the qualifying income and meet the HUD's AMI (Area Median Income) requirements.
For starters, the borrower must earn below 115% of the HUD's AMI, and down payment assistance may be forgivable. Borrowers that earn more than 115% of the HUD's AMI may repay their down payment assistance.
Credit score requirements vary by lender; however, they could go as low as 620 when you've applied for an FHA loan. One benefit of Chenoa down payment assistance is you don't have to be a first-time homeowner, and loan amounts depend on FHA guidelines; however, they vary by county.
You'll need mortgage insurance, and homebuyer education depends on your credit score. Additionally, there's no requirement for minimum borrower funds.
How the Chenoa fund down payment assistance program works with FHA
As mentioned earlier, the Chenoa fund down payment assistance program provides 3.5% down payment assistance, which is what FHA loans require. However, these funds should be used for a down payment, with no closing costs. Thus, you'll have to pay the closing costs out of pocket.
Chenoa funds work with FHA applicants through three different programs:
Chenoa fund rate advantage program
The Chenoa fund rate program is the most successful and popular Chenoa fund product. The program allows borrowers to lock in competitive rates on their primary mortgage plus a 3.5% down payment assistance loan. The loan requires applicants to have a minimum FICO score of 640 plus a maximum DTI (Debt-to-Income) ratio of 50%.
The program has a 135% income limit on the median income level of the county where the borrower intends to live. The down payment loan has an 8% interest rate and a 10-year term.
Chenoa fund down payment assistance program edge
This second 'soft' mortgage is popular among low-income borrowers because down payment funds are forgivable, and borrowers don't have to repay the loan.
Borrowers with a 620 FICO score and a Debt-to-Income ratio of 45% or lower can get the second mortgage interest-free with zero monthly repayments. The requirement for DTI increases for borrowers with higher FICO scores.
The mortgage is written off after 36 consecutive, on-time repayments on your primary mortgage. This program has a 115% income limit on the median income for the county the borrower intends to purchase a home.
Chenoa fund edge repayable second product
This program doesn't have income limits. For instance, borrowers should have a minimum FICO score and maximum DTI of 45%, and the DTI increases for individuals with a higher FICO score.
The loan has two terms to choose from a 30-year term at 5% interest and a 10-year term at 0% interest.
Some Chenoa Funds Benefits
In addition to down payment assistance, the Chenoa fund provides homebuyers with post and pre-purchase counseling to ensure borrower success. The CBC mortgage insurance created the program to support new homeowners throughout their first year as homeowners.
There'll be monthly check-ins to ensure any challenges, questions, or issues requiring assistance are solved by professional and supportive HUD-approved counselors. Additionally, the program is self-sufficient and doesn't rely on government subsidies. The program produces enough funds to help expand and run its services and other efforts to improve home ownership.
For instance, there is a widening gap between white and African American homeownership rates. The CBMA addresses this issue by teaming with the UHOUSI initiative to expand and create opportunities to increase homeownership for the African American community.
Chenoa fund is stale and better prepared to handle mortgage cycles in the industry. It's one of the best tools to use in the mortgage industry since it offers its funds generously and provides additional support in terms of counseling to new homeowners. The best time to apply for the loan is today; the next best time was yesterday.
The CBCMA is committed to availing meaningful mortgage services to its customers on an equitable and fair basis. Additionally, through the CBCMA, the Chenoa fund ensures fair lending and expects its lenders to do the same. Also, the CBCMA ensures all partners involved with the program undergo training to help them practice fair lending policies.
Chenoa Funds - Possible Drawbacks
Using the Chenoa fund assistance has a few drawbacks. For instance, borrowers must repay the loans except for the DPA edge soft second loan. As such, we advise you to research other down payment assistance programs in your area.
You should learn whether you qualify for home buying grants or forgivable loans. You should take the chance to apply for money that you aren't required to pay back. The difference with Chenoa loans is they provide more generous assistance than other DPA programs.
Not all programs will provide borrowers with 3.5% of the purchase price. Additionally, the program's homeowner counseling is an added advantage. Thus, the loan could be an excellent option for homeowners even if you have to pay it back.
Remember the Closing Costs
Closing costs refer to settlement charges individuals pay when purchasing a residential property. The fees include lender origination fees, appraisal costs, prepaid interest, discount points, escrow closing costs, prepaid taxes, title insurance, and hazard insurance premiums.
Most home buyers pay between 2 and 5% of their home's purchase price in closing fees. These costs can be split with the seller or negotiated. Choosing Chenoa fund down payment assistance provides you with funds to help with closing costs.
However, this doesn't apply to applicants using an FHA loan. Thus, you should speak with your lender to understand what's covered.
When are they due?
You should wire funds to escrow or provide a cashier's check when you sign the final loan documents.
How can you receive assistance for closing costs?
You have varying options you could use to cover your closing costs. You don't have to look for several thousand dollars by yourself to cover the fees. You should consult with your lender to determine what your options are.
Some options you should consider are:
Gifted money - You can use monetary gifts to offset your closing cost contributions, but you should follow the stipulations when using gifted money. Accepted donors include domestic partners and family members.
Seller concessions - You can offset your closing costs through seller concessions. The seller may pay part of your closing costs; however, the amount of cash the seller may offer depends on your loan program.
- Lender credits - You can't apply for lender credits if you plan on using Chenoa funds. However, you can lower closing costs by accepting higher interest rates through lender credits when using FHA or conventional loans. This option allows you to pay less upfront; however, you'll have to pay more over time at high-interest rates.
Chenoa Fund Program Guidelines
Unless specified by the CBCMA, all loans provided are closed and underwritten according to Fannie Mae or FHA guidelines. Other key points to remember include:
Chenoa down payment assistance funds are provided in all states except New York.
The program provides assistance of 3, 3.5, or 5%, depending on the product's DPA.
Lender fees and origination charges should conform to the 3% fees and points rule, according to TRID.
The applicant's first mortgage is sold to the CBCMA.
Your DE underwriter should underwrite the file- approval and credit. They'll issue the final approval to close.
Approved properties include detached and attached PUDs, SFRs, condos, modular homes, and townhomes.
Only the Chenoa fund DPA for FHA loan permits two-unit properties. The program doesn't allow 3 to 4-unit properties.
The program allows manufactured homes under exceptional circumstances for FHA loans.
- HPML is allowed with specific properties with no high-cost mortgages.
Five Places to Get an Acai Bowl in Polk County, Florida
Acai bowls are the most hyped-up foods on the market. The food is made from pureed acai berries and served as a smoothie in a glass or bowl topped with nuts, seeds, fruit, or granola. The food is known for its vibrant color, versatility, creamy texture, antioxidant properties, added sugar, and high calories.
Here are five places you can get Acai bowl in Polk county.
First Watch in Winter Haven serves healthy, hearty breakfast, brunch, and lunch. The spot has various events you can enjoy, including live concerts and breathtaking walks through scenic gardens.
You also get to unpack and visit various sweet spots in the region, like theme parks, farm tours, citrus groves, and historical landmarks. You also get to enjoy their fresh, delicious Acai bowl smoothies that are to die for.
Poke by Gochi
This spot is known for its simplicity and convenience. You can order online and get food delivered to your location effortlessly. The staff in the store work around the clock to keep it spotless, and meals are done quickly.
Additionally, their meals are larger than expected, and all ingredients are fresh. Their Acai Bowl servings taste amazing, and their staff is polite. You won't regret your decision to dine in this location.
Rooted in the nutrition shop Lakeland needed. The spot is super high-quality, and its owners know what they are doing. Rooted seels various foods, including fruity teas and protein shakes made with Herbalife supplement products.
The shakes sold in Rooted taste amazing, and their Acai bowl is even better. Additionally, their interior setting is even better with industrial light fixtures, succulent walls, and graffiti. Also, they have a fantastic staff who try to give you the most beautiful feeling ever.
Tea Largo Beverage
Tea Largo Beverage is easily among the top three for its Acai Bowls. The place is perfect for relaxing and having a good time, plus it has various acai bowl options to choose from plus a wide variety of toppings.
Additionally, Tea Largo Beverage has lots of delicious smoothies, teas, and coffee options that make you feel warm and fuzzy. Also, you can make online orders for the Acai bowls and any other meal and pick them up when you are ready.
Tasty Lemon - Acai Bowl Bar
If you love Acai bowls, you get a spot that knows how to make it right. Tasty Lemon is an absolute gem. Their bowls are enormous, and they have standard toppings.
They include honey, granola, coconut oil, and coconut shavings. Also, tasty Lemons has the best coffee, and we recommend it. The place exceeds expectations, and you'll be coming back for more.
Purchasing a home doesn't have to be complicated, and the Chenoa Fund DPA helps you get your dream home without much hassle.
All you need to do to purchase a home in Polk County, Florida, is ensure you are eligible for the FHA and Chenoa Fund programs.