Chenoa Fund is a national down payment assistance program administered by CBC Mortgage Agency, a federally chartered governmental entity. Through the Chenoa Fund program, CBC Mortgage Agency specializes in providing down payment assistance (DPA) for low- to moderate-income borrowers.
Through the Chenoa Fund program, CBC Mortgage Agency provides a second mortgage of 3.5% to meet the down payment required on 97% LTV conventional loans and to assist with some of the closing costs. Borrowers receiving this assistance must meet Fannie Mae (FNMA) guidelines outlined for conventional standard 97% LTV loans or the HomeReady®* program1 and Chenoa Fund program overlays.
How does the borrower qualify for Chenoa Fund DPA for FNMA conventional loans?
In order to qualify for Chenoa Fund down payment assistance for FNMA conventional loans, the borrower must qualify for a FNMA conventional loan and meet product overlays, including the following:
- Minimum credit score of 640
- Debt-to-income ratio maximum, based on FICO score:
- 640–659: 50% or less
- 660+: Per AUS findings
Some qualifications2 for the conventional standard 97% LTV program:
- At least one of the borrowers must be a first-time homeowner
No income limits under the conventional standard 97% LTV program
Some qualifications2 for Fannie Mae’s HomeReady® program:
- Home must be located in a low-income census tract, otherwise borrowers must not exceed AMI limits per FNMA guidelines
- One of the loan applicants must complete a homeowner education course
Why was the Chenoa Fund DPA for FNMA conventional loans created?
Homeownership isn’t for everyone—but housing is. While CBC Mortgage Agency’s minimum credit scores and debt-to-income ratio restrictions may put some borrowers out of the reach of receiving direct assistance, CBC Mortgage Agency believes that, through assisting creditworthy families to overcome down payment barriers, it can reduce the competition for rental housing, which in turn helps to reduce the cost of renting and increase its availability for those we cannot assist directly.
CBC Mortgage Agency does not originate mortgage loans. This is not an offer to lend money nor a solicitation of a mortgage application by CBC Mortgage Agency.
1 HomeReady® is a registered trademark of Fannie Mae.
2 CBC Mortgage Agency’s correspondent guidelines include additional overlays to the HomeReady® and Standard Conventional 97 programs.
*Neither CBC Mortgage Agency nor any of the Chenoa Fund products are approved by or affiliated with Fannie Mae®. It is the originating lender’s responsibility to ensure that the use of CBC Mortgage Agency second mortgages, the first mortgage, and the combination of the first and second mortgages are compliant with Fannie Mae® requirements.