Title: Chenoa Fund
1CBCMA Training Series 1 For Loan
Officers FHA Product Line
2Show Support for a Withdrawal of Mortgagee Letter
2019-06
1. In the link below, you will find documents
that can be used as a template to reach out to
key appointees and congress people who can
quickly act on this irresponsible use
of government power. Please share your thoughts
and be heard so we can preserve responsible down
payment assistance.https//chenoafund.org/hud-mo
rtgagee-letter-2019-06/2. We are also asking
for the stories of any borrowers who have been
directly affected by this letter. Please send us
any information you are able to about borrowers
who have been affected by this sudden change,
whether its their story, or their contact
information so we can reach out. We will be using
this to strengthen our case, and show the
negative impact the Mortgagee Letter has had.
3. If you have suspended our program until the
mortgagee letter is withdrawn, please send that
to us in writing, so we can show the number of
companies and people that this is affecting.
HUD issued Mortgagee Letter 19-06 without
following the Administrative Procedures Act. This
was unlawful, and has caused confusion and
concern in our industry. CBC Mortgage Agency
has filed for a restraining order to temporarily
block this new policy and once in place, will
file for injunctive relief. We are confident
that the mortgagee letter will be removed and
a more responsible policy will be implemented
that follows the proper procedures of public
comment and an implementation period. As we
litigate, we seek your support politically to
ensure that our politicians hold government
appointees accountable. We encourage you to
please be part of the solution to continue to
help credit worthy Americans purchase their own
home. Here are some ways you can help.
3Chenoa Fund by CBC Mortgage Agency General
Overview
- Chenoa Fund is the program name for CBC Mortgage
Agencys suite of down payment assistance
products. These products are offered to borrowers
in the form of second mortgages. - The programs are allowed in all states except New
York. - All programs offer 3.5 for the second mortgage.
Up-front fees are limited only by the 3 points
and fees rule. - The first mortgage must be sold to CBC Mortgage
Agency. - At the time you sell your first mortgage to CBC
Mortgage Agency, the down payment funds you
advanced are reimbursed. - Your underwriter underwrites the file.
- Approved property types include SFR, PUD,
Townhome, Condo, Attached, Detached, and Modular
Homes. - No Manufactured Homes.
- HPML (Rebuttable Presumption) is allowed, but no
High Cost Mortgages.
4Chenoa Fund by CBC Mortgage Agency FHA Overview
- Chenoa Fund is the program name for CBC Mortgage
Agencys suite of down payment assistance
products, including second mortgages for FHA
loans. - There are two FHA programs the Rate Advantage,
and the DPA Edge. - The Rate Advantage program has one product. CBCMA
offers the Rate Advantage Product to provide a
better first mortgage interest rate for the
borrower, and better YSP/SRP for the lender. - The DPA Edge is split into two products, one for
borrowers whose income is less than 115 AMI, and
one for borrowers who income is greater than 115
AMI. - Only the DPA Edge program includes a forgivable
second option. That option is available for
borrowers with an income that is less than 115
AMI.
5FHA Second MortgagesThe Rate Advantage Program
6Rate Advantage Program
- Qualifying Income lt or 115 AMI
- Requires monthly payment.
- FICO Scores 640 minimum.
- Second mortgage has a 10-Year term at an 8
Interest rate. - Non-occupant co-borrowers are not allowed.
- No concurrent homeownership.
- Max DTI 50
- Manual underwrites are not allowed.
- Note Look to this one first to benefit you and
your client.
7FHA Second MortgagesThe DPA Edge Program
8DPA Edge Soft Second (1/2)
- Qualifying Income lt or 115 AMI.
- No monthly payment.
- FICO Scores 620 minimum.
- 0 Interest Rate and 30-year Term.
- Forgiven after 36 consecutive on-time payments on
FHA 1st Mortgage. - Non-occupant co-borrowers are allowed.
- DTI per AUS or FHA manual underwriting guides.
- Only offered for single-family and two unit
properties. - Three to four unit properties not allowed.
9DPA Edge Repayable Second (2/2)
- Qualifying Income gt 115 AMI.
- Requires monthly payment.
- FICO Scores 620 minimum.
- 10-Year term 0 interest rate.
- 30-Year term 5 interest rate.
- Non-occupant co-borrowers are allowed.
- DTI per AUS or FHA manual underwriting guides.
- Only offered for single-family and two unit
properties. - Three to four unit properties not allowed.
10Quick Comparison Matrix FHA Products
Rate Advantage a.) CBCMA offers 3.5 to cover
down payment. b.) 2nd mortgage repayable. c.) 8
with 10 year term. d.) 640 minimum FICO
score. e.) Qualifying Income less than or equal
to 115 AMI. f.) Max DTI 50. g.) Homebuyer
education not required. h.) Please see HUD
handbook 4000.1 for current upfront MIP rates.
DPA Edge Repayable Second a.) CBCMA offers 3.5
to cover down payment. b.) 2nd mortgage
repayable. c.) 0 interest with 10 year term
or 5 interest with 30 year term. d.) 620 minimum
FICO score. e.) Qualifying Income greater than
115 AMI. f.) DTI restrictions per AUS
guidelines. g.) Homebuyer education required for
borrowers with credit scores between 620-639. h.)
Please see HUD handbook 4000.1 for current
upfront MIP rates.
DPA Edge Soft Second a.) CBCMA offers 3.5 to
cover down payment. b.) 2nd mortgage
forgivable. c.) Forgivable after 36 consecutive
on-time payments on the 1st mortgage. d.) 620
minimum FICO score. e.) Qualifying Income less
than or equal to 115 AMI. f.) DTI restrictions
per AUS guidelines. g.) Homebuyer education
required for borrowers with credit scores between
620-639. h.) Please see HUD handbook 4000.1 for
current upfront MIP rates.
11In regards to Homebuyer Education, Be sure to
visit our Lender FAQs for more information on
this topic. https//chenoafund.org/lender/lender-f
aq/ CBC Mortgage Agency offers pre-purchase
counseling through Hope Loan Port, also known as
Money Management International. This pre-purchase
counseling is provided for borrowers with a FICO
score of 620 to 639, which also means this
counseling is only required for our DPA Edge
products. The aforementioned counseling courses
are paid for by CBC Mortgage Agency. As such,
correspondent-lenders should never direct their
borrowers with FICO scores 640 to go to
https//www.borrowersuccess.org/prepurchase. If
borrowers without the proper FICO score attempt
to access this course, they will be turned away,
which will cause much stress, frustration, and
confusion on many borrowers parts. For your
borrowers that have a FICO score of 620 to 639,
note that they will not be able to access the
course until 1.) they have been registered
and/or locked by their lender in CBC Mortgage
Agencys portal. 2.) they have allowed for 24
hours to pass after the LO receives the relevant
confirmation letter. 3.) they have a CBC loan
number, provided for them by their LO (will start
with 161). Coborrowers outside the 620 to 639
range will not need to take the course. If you
wish for your borrower with a FICO score 640 to
take Homebuyer Education through Hope Loan Port
anyway, please utilize this link instead.
https//www.moneymanagement.org/buying-a-home/onli
ne-homebuyer-courses. Here, the courses range
from 75-99. Feel free to contact
info_at_chenoafund.org for even more information on
Homebuyer Education.
12Check out our Program Guidelines! A more detailed
version of our product matrix can be found on
chenoafund.org.
Next, click on Program Guidelines.
Finally, scroll down to pages 8-16.
First, click on Lenders.
13Calculating Area Median Income
- Go to the HUD Area Median Income Site.
- https//www.huduser.gov/portal/datasets/il.html
- Select the most recent fiscal year.
- Then Click Here for FY most recent year IL
Documentation
14Calculating Area Median Income
- Select the state.
- Select the county.
- Click View County Calculations.
- Note This is a third party site. CBCMA State
Restrictions still apply, even if you see the
option here.
15Calculating Area Median Income Primary Method
- For the primary method, youll want to pull the
number from the Median Family Income column.
This is outlined in red. - You determine the AMI by multiplying the Median
Family Income by 115. - Example 69,100 x 115 79,465
- Note Pick the method that will best match your
borrower to their desired program!
16Calculating Area Median Income Alternative
Method
- There is an alternative calculation method
allowed within the UW comments on the 1008. - First, locate the appropriate family size
underneath the Persons in Family column, in the
Very Low (50) Income Limits row. - Find the appropriate income limit, and then
multiply that number by two. - Then, multiply that number by 115.
- Example, using a family of 6 40,100 x 2
80,200 X 115 92,230 - Note Pick the method that will best match your
borrower to their desired program!
17Pre-RegistrationThe 1003
181003 Important To Remember
- Both the First and Second Mortgage require a full
set of TRID compliant disclosures, which should
include the - 1003
- LE
- Initial CD
- Final CD
- For a comprehensive list of all the documents we
require the borrower to sign, please refer to our
Program Guidelines, which can be found at
ChenoaFund.org.
19Secondary Financing on 1003 (1st Mortgage)
- Image List secondary financing as follows on the
1003.
20Declarations Page of 1003 (1st Mortgage)
- Image Where to disclose the DPA.
21Secondary Financing LP (1st Mortgage)
- Image You will see this screen if you are using
Secondary Financing LP system.
221st Lien Closing Disclosure (1st Mortgage)
- Image The DPA must be listed as CBC Mortgage
Agency 2nd Lien under section L04 or under
Other Credits.
23Important Reminder
- You must deliver disclosures to borrower
following the TRID guidelines. - The LE must be mail stamped or signed by borrower
within 3 days of the 1003. - Digital signatures are acceptable.
24Commonly Missed Documents
- Make sure you upload these commonly missed files
to avoid added conditions. - Credit Package
- Soft pull credit report within 10 days of close
(alternatively, you can provide evidence of
credit monitoring). - Case Query to show UFMIP is paid.
- Appraisal logging.
- Both the 1st and 2nd Mortgage 1003s.
- Closing Package
- MRI Funding Obligation Letter.
- First Note and Deed of Trust/Mortgage.
- Second Note and Deed of Trust/Mortgage.
- An executed copy of the assignment of a second
Deed of Trust/Mortgage or evidence of second Deed
of Trust/Mortgage MIN transfer in MERS.
25Features and Benefits FHA
CBC Mortgage Agency is a government entity
powering Chenoa Fund, a tool designed to help
increase home ownership. This is accomplished by
offering qualified borrowers down payment
assistance in the form of 2nd mortgages,
resulting in zero down payments. Renters
looking to buy a home in the near future cited
the following barrier saving enough for a down
payment. -Forbes
- Features
- FICO down to 620.
- DTI based on AUS findings (no overlay cap).
- No first-time homebuyer requirement.
- Any city, any state (NY excluded).
- Co-borrower assistance with a non-occupant
coborrower. - No income limits.
- Stable, continuous, non-bond funding.
- Benefits
- Easy for borrowers to qualify.
- Increased purchasing power.
- Simplicity.
- Purchasing where the customer desires.
- Qualifying options with the family.
- Streamlined process.
- A knowledge that funding will always be available.
- Product
- DPA Edge
- DPA Edge
- DPA Edge/Rate Advantage
- DPA Edge/Rate Advantage
- DPA Edge
- DPA Edge
- DPA Edge/Rate Advantage
- No matter your current relationship with DPA, now
is the time to increase loan volume, qualify more
customers, and experience fewer dropped
loans. Chenoa Fund is provided by CBC Mortgage
Agency, an FHA approved Government Title II
Lender. HUD statute allows government entities to
provide down payment assistance. - Chenoa Fund is the premier DPA that offers
simplicity, ease, and options that can help you
and your customers accomplish great things in
home ownership. - All industry guidelines apply. These marketing
ideas can generate interest and phone calls from
consumers and real estate agents.
26Show Support for a Withdrawal of Mortgagee Letter
2019-06
1. In the link below, you will find documents
that can be used as a template to reach out to
key appointees and congress people who can
quickly act on this irresponsible use
of government power. Please share your thoughts
and be heard so we can preserve responsible down
payment assistance.https//chenoafund.org/hud-mo
rtgagee-letter-2019-06/2. We are also asking
for the stories of any borrowers who have been
directly affected by this letter. Please send us
any information you are able to about borrowers
who have been affected by this sudden change,
whether its their story, or their contact
information so we can reach out. We will be using
this to strengthen our case, and show the
negative impact the Mortgagee Letter has had.
3. If you have suspended our program until the
mortgagee letter is withdrawn, please send that
to us in writing, so we can show the number of
companies and people that this is affecting.
HUD issued Mortgagee Letter 19-06 without
following the Administrative Procedures Act. This
was unlawful, and has caused confusion and
concern in our industry. CBC Mortgage Agency
has filed for a restraining order to temporarily
block this new policy and once in place, will
file for injunctive relief. We are confident
that the mortgagee letter will be removed and
a more responsible policy will be implemented
that follows the proper procedures of public
comment and an implementation period. As we
litigate, we seek your support politically to
ensure that our politicians hold government
appointees accountable. We encourage you to
please be part of the solution to continue to
help credit worthy Americans purchase their own
home. Here are some ways you can help.
27Important CBC Mortgage Agency Contacts
- Purchase Clearing
- Please contact the Purchase Clearing specialist
for the specific loan youre working on. - Collateral/Shipping
- finaldocs_at_chenoafund.org
- Servicing
- servicing_at_chenoafund.org
- Information and questions
- info_at_chenoafund.org
-
- Portal Questions
- submissions_at_chenoafund.org
- Pricing Questions
- locks_at_chenoafund.org
- Underwriting Questions
- scenariodesk_at_chenoafund.org
28Conclusion