09/09/2021
All policy changes and updates are referenced below to the appropriate section of the CLG. These policy changes are effective 09/09/2021 unless otherwise noted.
To review the program guidelines changes made August 25, 2021, or earlier, please follow this link to the archived Correspondent Lending Guides.
These updates apply to everyone using the Chenoa Fund program—correspondents and TPO.
.
Announcement
CBCMA would like to announce that the homeownership education course provided by Framework®, a HUD-approved counseling agency, does meet Chenoa Fund™ homeownership education overlays for FHA loans for borrowers with a FICO score of 620 or greater. Chenoa Fund™ overlays still require the homeownership education course to be taken through Money Management International if the borrower’s FICO score is below 620 and if the first mortgage attached to the DPA is an FHA loan. (See section 5.20, Homeownership Education, for more information.)
.
Guidelines Updates
On August 11th, 2021, Fannie Mae™ updated how credit score eligibility is calculated in DU®. Borrowers that meet DU credit score eligibility using Fannie Mae’s calculation will meet the minimum credit score requirement for Chenoa Fund™ down payment assistance for FNMA conventional loans. Accordingly, section 5.13 (Minimum Credit Score) has been updated to the following:
All Conventional Programs: 620 FICO. Per FNMA guidelines for loans with multiple borrowers, the middle scores of all borrowers on the loan may be averaged to determine whether this 620 FICO requirement is met. Loan requirements determined by FICO score will match the 620–659 FICO requirements if any individual borrower on the loan has a qualifying FICO score lower than 620.
.
For borrowers in the 640–659 FICO bracket, Chenoa Fund™ overlays require documentation of the borrower’s housing payment amount, but a housing payment history is not required. Borrowers with a housing payment amount of $0 are still required to provide some documentation of housing payment amount. Section 5.17 (Present Housing Expense & Verification of Housing Payment) has been updated to clarify this information:
Occupying borrowers in the 640–659 FICO range: Only verification of the amount of the current housing expense is required. Acceptable forms of documentation may include, but are not limited to, a copy of the rent/lease agreement, a bank statement and/or a cancelled check tracking payments for the amount of reported rent, a letter from the landlord, or a filled-out VOR (if a VOR is provided, the rental history will be used in credit qualification).
.
Section 6.2.1 (Specific Details on Manufactured Housing) has been updated to reflect that non-occupant co-borrowers are allowed with manufactured housing in some circumstances:
Occupancy: Primary residence only. Non-occupant co-borrowers only allowed with DPA Edge products (see section 5.25).