This will be the last blog in a series of blogs to try to provide a basic knowledge of some of the better known, and more common Federal Programs that were designed to help homeowners in trouble with their mortgage. So far we have covered five programs and what their acronyms stand for.
Recapping the programs that I covered so far:
HAMP (Home Affordable Modification Program)
HOPE aka H4H (Home for Homeowners)
This blog however will be a little different from the other blogs in this series. That is because I will go into this program more in debth than the others, also the way this program functions is different than the others listed above.
The program that I am talking about is the CT Familes Refinace Program. This program just like EMAP was created through Connecticut Public Act 08-176, which passed in 2008 during Governor Reil's administration. At that time Governor Reil initially allocated 50 million dollars to the Connecticut Housing Finance Authority (CHFA) to administer this program. However, un like EMAP, CHFA does not originate and service these loans, CT Families is originated and serviced by local Lenders.
The primary goal of CT Families was to help families that have found themselves in a financial hardship because of increased monthly payments when their Adjustable Rate Loan adjusted. But it quickly became apparent that the program needed to expand its parameters to include hardships that were out of the homeowners control such as:
- Loss of Job, but they have to be presently employed to qualify, because they have to demonstrate the ability to pay the new reduced payment.
- Temporary loss of overtime or reduction in work hours
- Unexpected loss of child support or alimony
- An unanticipated expense such as a funeral or medical bills.
- An unforeseen housing repair expense not covered by insurance
- Loss of rent if the house is a multi-family house.
These are just of few of the possible things that qualify as a financial hardship for this Connecticut Housing Finance Authority (CHFA) Connecticut Families Refinance Program. What does not qualify as a hardship is if the financial problems were caused by financial mismanagement, such as running up credit cards. A divorce is also not a qualifying reason for a hardship for this program. The Homeowner does not have to be current on their payments, as well as other monthly debts, but as stated before the reason for the financial problems can’t be because of financial mismanagement.
Guidelines for the Connecticut Housing Finance Authority (CHFA) Connecticut Families Refinance Program are:
- Max LTV 97%; Max CLTV 108%
- Pre-closing and post-closing counseling are required
- Underwritten by CHFA guidelines – no delegated underwriting
- No minimum FICO
- Ratios 31%/43% although exceptions up to 50% are allowed with compensating factors on a case-by-case basis.
- Cannot refinance if meets the guidelines of available conventional or government insured fixed rate mortgage
- Homeowner must write a hardship letter fully detailing the cause(s) for the hardship.
- Interest rate is the current CHFA rate (3.25% this week)
- DO NOT have to be first time homeowners to qualify, as in the case for other CHFA programs.
There are other guidelines for this program, but these are the major ones.
Just like EMAP this is one of the few programs that is still available, that actually provides real help. I have done several CT Families Refinance Loans, and each one cut the monthly payment SUBSTANTIAL. The last one that I did, cut the monthly payment by $700 per month.
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Who To Call For Your Mortgage Needs In Connecticut:
George Souto NMLS# 65149 is a Loan Officer who can assist you with all your FHA, CHFA, and Conventional mortgage needs in Connecticut. George resides in Middlesex County which includes Middletown, Middlefield, Durham, Cromwell, Portland, Higganum, Haddam, East Haddam, Chester, Deep River, and Essex. George can be contacted at (860) 573-1308 gsouto@mccuemortgage.com, or visit my McCue Mortgage Homepage.
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