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NEW FHA Limits help CHFA and 1st time Homebuyer!

By
Mortgage and Lending with National City Mortgage

 

                                          CT HOMEBUYERS-NEW FHA LIMITS-Mean Bigger CHFA LOANS

 

 

There is a lot of confusion with today's consumer regarding 1st time Homebuyer products.  Most lenders either do not offer the Connecticut Housing Finance Authority's program because they are not direct lenders or because they do not service the mortgage asset and subsequently do not get paid a sizeable commission.  The results have been disatrious as many borrower's have been put into mortgage programs that adjust higher.  The mortgage lender was more concerned with making a commission than they were with providing their borrower with a low fixed rate mortgage that could be a reliable part of a monthly budget.

CHFA and FHA are not the same, but most CHFA mortgage are insured by the Federal Government.  The Federal Housing Authority (FHA) has done its part to help to stimulate the softening housing market by increasing their limits across the country.  This will allow buyers the ability to purchase owner occupied homes with a secured fixed rate, with little or no money down and with less than perfect credit.  The Connecticut program (CHFA) is argueably the best run state bond program in the country.  The biggest advantage to CHFA is that it allows for 0 money down and the ability to finance closing costs.  The buyer is given an interest rate that is typically between 1/2 to 3/4 of a point below Conventional or FHA rates.  The problem in the recent past has been that CHFA was unwilling to fund loans that exceeded the FHA or VA (Veterans Adminstration) loan limits.  Many communities in Connecticut had a huge gap bewteen FHA's limits and CHFA's limits.  In some cases this gap was $350,000.00

 

This gap has no been closed to zero in all but a few cases!

 

Great websites to access both CHFA's purchase price limits and FHA's new enhances loan limits are www.chfa.org and www.hud.gov

The Connecticut Housing Authority also has income limits as well as purchase price limits.  In targeted zones, the income limits are waived (you can make as much as you like) as long as you can put 3% down.  The combination of CHFA/FHA also allows the seller's to pay up to 6% of the closing costs meaning that the customer only needs the 3% which can be a gift!

 

Many homes will not be purchased simply because customers, realtors and mortgage professionals do not know what programs are out there.  Let's educate our buyers and do more business.

Anonymous
Ed
Very informative and hopefully I can get myself qualified with a CHFA mortgage. Is there any down payment assistance available with a CHFA mortgage?
Mar 10, 2008 09:58 AM
#1
David M Perry
National City Mortgage - Waterbury, CT

Yes CHFA has a down payment program available that includes all closing costs.  It will depend on the community you are looking to purchase in and your income based on the number of people in your family.  Today's CHFA rate is 5.75% with 1 point (which can be financed as well).  You will need to attend a 3 hour class in a location that is most convenient for you once you have an accepted sales contract.  The down payment and closing cost assitance is a 2nd mortgage but also fixed for 30 years with the same rate.

 

The program is for 1st time homebuyers but for those that have not owned a home in 3 years are also defined as a 1st time homebuyer.  Also if you live in a targeted area and are going to stay in a targeted area, you will qualify for CHFA. 

Mar 10, 2008 10:35 AM
Anonymous
JC

I am looking in to buying my first home in Stamford, preferably a condo.  I have some savings to put out for the downpayment (15-20%) and closing costs. What are some of the best programs that I can take advantage of, which will help reduce the monthly payment? 

Jun 27, 2008 04:24 AM
#3
Anonymous
Paul J. Levesque, Jr.

Does the CHFA limit the amount of concession by the seller to the buyer at closing? And if so what is  the amount?

Jan 16, 2011 08:55 AM
#4
Anonymous
Kujtime komina
Ps I'm looking forward to get a phoone call back with info about chafa
Oct 07, 2011 08:41 AM
#5