Chenoa Fund: Myth Versus Fact Quiz
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Myth or Fact: Chenoa Fund down payment assistance has a universal minimum FICO requirement of 640.
Myth! The DPA Edge products have a minimum FICO requirement of 620.
Myth or Fact: CBC Mortgage Agency works through correspondent lenders to offer Chenoa Fund down payment assistance to borrowers.
Fact! CBCMA never offers Chenoa Fund directly to borrowers; Chenoa Fund is always offered through correspondents.
Myth or Fact: Chenoa Fund down payment assistance is offered in all 50 states.
Myth! Chenoa Fund is offered in 49 states; it is not offered in New York.
Myth or Fact: CBC Mortgage Agency funds the Chenoa Fund down payment assistance at closing.
Myth! The correspondent funds the Chenoa Fund down payment assistance at closing, then CBC Mortgage Agency later refunds the assistance amount to the correspondent.
Myth or Fact: The Rate Advantage product offers 3.5% assistance or 5% assistance.
Fact! Borrowers can choose between the two DPA amounts, the only difference being that the 5% assistance amount has a slightly higher rate on the first mortgage.
Myth or Fact: Chenoa Fund offers down payment assistance for Freddie loans.
Myth! Chenoa Fund currently only offers down payment assistance for Fannie Mae conventional and FHA loans.
Myth or Fact: All Chenoa Fund down payment assistance products are paired with a 30-year, fixed rate first mortgage.
Myth or Fact: Chenoa Fund is never paired with muti-unit homes.
Myth! But, admittedly, almost a trick question. Only the DPA Edge products may be paired with multi-unit homes, and even then the maximum number of units is 2. The Rate Advantage, HomeReady®, and Conventional 97 products are all only paired with 1-unit homes.
Myth or Fact: All Chenoa Fund down payment assistance loans are repayable.
Myth! The DPA Edge Soft Second, for FHA loans, is a forgivable loan. Borrowers that make 36 consecutive, on-time payments on the first mortgage will see their second mortgage entirely forgiven if their second mortgage is the DPA Edge Soft Second.
Myth or Fact: Despite referring to all of its products as down payment assistance, Chenoa Fund assistance may also be applied towards closing costs and prepaid items.
Fact! Chenoa Fund’s down payment assistance may be applied towards the borrower’s minimum required investment, closing costs, and prepaid items. This is most applicable for assistance for conventional loans, where Chenoa Fund assistance is 3.5% and the minimum required investment is 3%, and the Rate Advantage product, where Chenoa Fund assistance may be 5% and the minimum required investment is 3.5%.