100% Home Financing.
100% Responsible Homeownership.
Chenoa Fund is an affordable housing program created to provide families with an affordable option for purchasing a home. When combined with our first mortgage, qualified borrowers can receive a second mortgage or grant to purchase a home with little or no cash investment.
Our affordable housing programs help meet the needs of an underserved population. Because of the restrictions put on lending in recent years, there is a significant need for home financing by those who have good credit and a responsible debt burden, but who have been unable to to put aside sufficient funds to provide a down payment. There is also a significant number of borrowers who would rather save the nest-egg they have carefully amassed for a rainy day rather than use it for a down payment.
Through the Chenoa Fund, borrowers that meet our credit score and DTI requirements (see our program guidelines, and who can otherwise qualify for an FHA loan, can receive a first mortgage and a second mortgage or grant to cover their 3.5% minimum investment requirement.
Below is a summary of the correspondent loan process with the Chenoa Fund program. For more details, please call us at 866-563-3507, or complete the form to the left.
- Originator e-mails (1) a completed Loan Registration/Rate Lock request, and (2) the Fannie Mae 3.2 file.
- Originator has the Initial Disclosures (LE and Second Mortgage Disclosure) signed by the borrower(s).
- Originator receives a Rate Lock Confirmation.
- After the loan closes, using the proper Stacking Order, Correspondent uploads the credit file and closing packages (including the Collateral Package*) into the Client Portal. To login to the Client Portal, you will need to contact us for credentials or complete the form to the left.
- Originator sends the Collateral Package* (including an Allonge endorsing note to CBCMA) to Originator’s warehouse bank.
- Originator pays the FHA insurance fee and requests an FHA insurance endorsement. Evidence is uploaded by Originator into the Client Portal.
- The Mortgage Loan is underwritten and conditions sent to Originator.
- The Collateral Package* is sent to Chenoa Funds’s warehouse bank from Originator’s warehouse bank.
- Any conditions are uploaded into the Client Portal for review.
- Chenoa Fund provides purchase and reimbursement advice to Originator.
- Chenoa Fund wires funds to Originator’s warehouse bank.
- Originator sends a Goodbye letter to borrower and transfers MERS to Chenoa Fund.
- Upon endorsement, Originator transfers the FHA Case Number to Chenoa Fund.
*Collateral Package consists of the following documents: Note, DoT, Riders, Allonge, Bailee Letter
Program Guidelines Summary
The objective of the Chenoa Fund is to assist as many homebuyers as possible to achieve the dream of homeownership. Our guidelines are designed to allow as many credit-worthy borrowers as possible the ability to purchase a home. Below are some highlights of our guidelines, or you may also view our complete Program Guidelines.
- First Mortgages–First mortgage loans must be a fixed rate and conform to standard FHA guidelines. No high balance or ARM loans are acceptable. All first mortgages must be issued by or sold to CBC Mortgage Agency and conform to CBC Mortgage Agency investor guidelines.
- Second Mortgages–The second mortgage can be up to 3.5% of the sales price or appraised value, whichever is less. The combined loan to value cannot exceed the amount of the first mortgage (including any financed mortgage insurance premiums) plus the required 3.5% down payment.
- DTI Ratio–Maxiumum DTI per AU findings or manual underwriting guidelines found in Mortgagee Letter 2014-02). The required monthly payments under both the FHA-insured first mortgage and the second mortgage, plus other housing expenses and all recurring charges, cannot exceed the borrower household’s reasonable ability to pay.
- Credit–Borrowers must have a minimum FICO score of 620.
- Disclosure–The source, amount, and repayment terms of the secondary financing MUST be disclosed in the first mortgage application, and the borrowers must acknowledge that they understand and agree to the terms.
- Second Mortgages Fees–Loan Originators may not charge any fees in conjunction with the second mortgage other than a reasonable document preparation fee.
- Second Mortgages Borrower Fees–The only fees chargeable to the borrower in conjunction with the secondary financing are pre-paid interest, fees for a junior lien policy, recording fees for the Trust Deed, reasonable document preparation fees, CBCMA document preparation fee of $99 and a courier fee to return the signed documents to the Lender.
What Is Chenoa Fund?
An FHA Approved Government Lender. CBC Mortgage Agency, a government lender, created the Chenoa Fund program to assist borrowers to achieve the dream of home ownership. We provide an FHA first mortgage as well as grants and second mortgages the borrower can use to cover their down payment. We partner with quality mortgage companies to provide borrowers with an amazingly easy home-buying experience. For more information, call 866-563-3507.