All policy changes and updates are linked to the appropriate section below. These policy changes are effective 04/09/2021 unless otherwise noted.
Additionally, CBCMA has compiled all of its announcements related to COVID-19 into one section immediately following the Recent Updates and Announcements section. To review the program guidelines changes made March 15, 2021, or earlier, please follow this link to the archived Program Guidelines.
Chenoa Fund No Longer Requires MICs Prior to Purchase
MICs will no longer be required prior to purchase beginning April 9th; loans with a credit reject are an exception to this rule, and loans with a credit reject will not be eligible for purchase until we receive a MIC. Manufactured housing is also an exception to this rule, and loans for manufactured housing will not be eligible for purchase until we receive a MIC.
In addition, for all loans, upfront MIP must be paid prior to purchase.
This announcement rescinds a previous temporary COVID-19 overlay. All other COVID-19 overlays listed in the “COVID-19 Temporary Guidance” section of our Correspondent Lending Guide (just after the “Recent Updates and Announcements” section and just before the table of contents) are still in effect.
Our correspondent lenders are still asked to review at least weekly which loans have outstanding MICs. To review which purchased loans still have outstanding MICs, please log on to our lender portal on our website (ChenoaFund.org) and click “Reports and Uploads” in the middle of the toolbar at the top of the screen. Then, on the grey toolbar that appears just underneath, click “Outstanding Mortgage Insurance Documents.” You will then find a list of purchased loans with outstanding MICs.
This announcement requires several revisions to the Correspondent Lending Guide:
The guidelines in COVID announcement 20-22 are being revised to note that loans that enter into forbearance prior to purchase will not be purchased by CBCMA:
CBCMA will not purchase loans that are in forbearance. In addition, correspondents will be required to immediately repurchase a loan if, after CBCMA has purchased the loan, the correspondent authorizes a forbearance agreement without coordinating with CBCMA. To coordinate forbearance agreements, please reach out to email@example.com.
To clarify what counts as a high balance loan and how such loans operate with Chenoa Fund, a new sub-section was added under 5.5 (Program Notes and Disclaimers). The new sub-section is 5.5.1 (High Balance Loans):
A High balance loan is any loan that exceeds the FHFA loan limit (typically the standard conforming loan limit, not the individual county conforming loan limit). In AK and HI the FHFA limit is higher than in the continental US and is the threshold used to determine whether or not a loan is High Balance.
High balance loans are acceptable with the following Chenoa Fund DPA Products:
High balance loans are not acceptable for Chenoa Fund down payment assistance for conventional loans or the DPA Edge Soft Second 5%.
Section 5.17 (Present Housing Expense & Verification of Rent) has been revised regarding housing gaps. Borrowers with a FICO score of 640–659 will not be required to provide an LOX if they have a housing gap larger than thirty (30) calendar days (borrowers with a FICO score lower than 640 will still be required to provide an LOX under such conditions):
Borrowers in the 620–659 FICO range and making a housing payment may have a housing gap of up to ninety (90) calendar days before closing. (This gap may be included in the 12-month verification of housing payment or expense.) Borrowers with a FICO score of 620–639 will need to provide a letter of explanation if the housing gap is larger than thirty (30) calendar days. For example, a borrower may have left a previous rental agreement and then lived rent-free with family in preparation for closing on a new home.
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