Real Estate Questions Answered Here
by Art Santellen, REALTOR®
NOTE: In past times, CHFA would issue bonds to raise money. The money raised was offered to first-time home buyers for the purchase of homes. This money would come in chunks every 3 or 4 months. Lenders around town would wait for the issue date and usually all the money was gone within the first 2 or 3 hours. It was an awful way to parcel out money. Read on to find out how things have changed.
Q: How does CHFA work?
A: Every year, the administrators of the CHFA programs sell tax exempt bonds or taxable bonds to investors, or they borrow money (just like banks) and they make the money available to qualified home buyers. This money is always available because CHFA is always selling bonds to raise money. The money raised is used to help first-time home buyers finance the purchase of their home.
Q: I thought there was just one CHFA program. How many programs are there?
A: There are five programs. The one most people know about is the Mortgage Revenue Bond Program. This program has two major features: 1. Allows qualified home buyers to get a lower interest rate on their home loan. 2. Allows home buyers to receive up to 3% of the loan amount in the form of cash assistance to be used for closing costs (including the down payment). The "Home Start" program allows people to choose between getting 3% assistance and a slightly lower interest rate. Or, you can choose 0% assistance and get a really terrific interest rate. The "Home Start Plus" program allows people to get 2% down payment assistance and an interest rate that's still pretty good.
Q: So what's a qualified home buyer?
A: First, your gross annual income cannot exceed certain limits placed by the folks at CHFA. That income limit is decided by the county you live in and the program you select. Archuleta, El Paso, Gunnison, Park, Pueblo, Teller, Weld, and other rural counties have $46,160 as the lowest annual income limit. That means you can't earn more than $46,160 per year to be able to take advantage of the CFHA programs. Second, you need to be a first-time home buyer. That is, no ownership in a home anytime during the past three years. On the other hand, if you did own a home in the last three years but are willing to buy in a "targeted area" of El Paso County, you can still qualify. Call me for specific information. Finally, you need to live in the home you're buying...no landlords,
please.
Q: Do all mortgage companies and banks have this CHFA program?
A: No.
Q: Will CHFA apply if I'm getting a conventional loan?
A: Yes. VA, FHA, farm loans, and conventional loans are all eligible.
Q: Will CHFA apply if I'm getting an adjustable rate mortgage (ARM) loan?
A: No. Only fixed rate mortgage loans can get CHFA assistance.
Q: Can I buy a four-plex or apartment building?
A: No. Only single family residences like a house, condo or town house. Also, certain duplexes qualify but check with your lender before submitting an offer on a duplex.
Q: Is there a limit to the purchase price of the home I want to buy?
A: Yes. Only existing homes up to $153,500 in El Paso County and up to $156,650 in Pueblo County. New homes up to $180,000 in El Paso County and $156,650 in Pueblo County can qualify. Other limits apply to other counties. Like I said, check with a CHFA certified lender (like me).
Q: What other programs does CHFA have?
A: The four others are: 1. The Recycled Funds Program which provides a limited number of mortgage loans originated by affordable housing and community reinvestment lenders. 2. The Mortgage Credit Certificate Program which provides a federal income tax credit to qualified home buyers. 3. The Down Payment & Closing Cost Assistance Program which provides for a second mortgage to help with closing costs. 4. The Housing Opportunity Fund which provides funds for housing organizations, communities and municipalities to stimulate the development of housing for low income families.
Q: Where can I get more information on CHFA?
A: Somewhere on this page is my ad. Just look "Arthur, the Vampire Slayer." That's me. Or, leave a message for me with the good folks at Hispania News. I'll send you brochures and phone numbers. Or, if you want, leave me a voice mail message at 381-1114 so I can talk to you personally.
I also want to tell you that to get a CHFA loan, you need to get loan pre-qualified with a mortgage lender who is authorized to make CHFA loans, find the home you want to buy, and be under contract to buy that home. Yes, you also need to attend a Home Buyer's Seminar (which are held monthly at Well Fargo Home Mortgage). Want some help? Give me a call at 381-1114 and leave your name along with your phone number.
Next week, another question about buying/selling real estate and getting a home loan which I promise to answer next week, right here, in Hispania News.
Art Santellen is a licensed real estate professional with Intrepid Realty in Colorado Springs.
News Flash: Art is also a Home Mortgage Consultant with Wells Fargo Home Mortgage!! If you have a question you'd like answered, please send them to Art care of Hispania News PO Box 15116, Colorado Springs, CO 80935. You may also send your question directly at Art via email at ASantellen@hotmail.com. Or call him at his Wells Fargo Office: (719) 381-1114.
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