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Homeownership Program

Program Overview

The Homeownership Program offers mortgages at below-market interest rates to tenants of publicly assisted housing who wish to transition from renting to homeownership.  Though the program primarily is designed to support first-time homebuyers, renters who were homeowners may still be eligible for a loan under this program if the property they intend to buy is located in a federally targeted area that would benefit from increased home ownership.  

CHFA is committed to helping Connecticut residents achieve their dream of homeownership and values its partnership with the qualified lenders for this program.  Prospective borrowers may apply directly for a Homeownership Program loan at their local CHFA-approved participating bank or mortgage company. (See, list of Participating Lenders near you.)

Follow the links below for more information regarding the Homebuyer Mortgage Program.  

 

Homeownership Program Interest Rates

Currently, the Homeownership Program is providing mortgages at the following rate:

    • Government Insured Interest Rate: 3.125%** (APR range 3.225 - 3.625%)
    • Non-Government Insured Interest Rate: 3.375%**(APR range 3.475% - 3.875%)
    • Fees: Additional fees may apply.
    • Term: 30 years, fixed rate

** Please note, this rate is subject to change and additional fees may apply.


 

Who can apply for a Homeownership Program loan?

First-time homebuyers that meet minimum credit, income, and employment standards who are tenants of public housing or receive public housing assistance may qualify for a Homeownership Program loan.   

Tenants who currently receive rental assistance through the Section 8, Rental Assistance Program, the Department of Developmental Services or the State Moderate Rental Program also are eligible to apply for a Homeownership Program loan.  In addition, tenants of the following property types are eligible to apply under this program:

    • residences managed by a CHFA or municipal housing authority
    • CHFA-financed rental properties
    • HUD-subsidized housing supported by HUD programs 221(d)(3), 241(f) or 236  

 

Previous homeowners who otherwise meet the eligibility requirements for this loan may also qualify for this program if they intend to purchase a home in one of the areas in Connecticut targeted for revitalization (See Targeted Areas).


  • Who are considered first-time homebuyers?
    First-time homebuyers are those who have never purchased a home before or have not had an ownership interest in a principal residence for the past three years.

  • What are the income guidelines to qualify for this loan?
    An applicant's annual, before-tax household income must not exceed CHFA's "Statewide" income limits. Household income is based on household size. (see top section of "Income and Sales Price Limits" chart).

    The CHFA income limits do not apply for homes purchased in targeted areas, unless the applicant also borrows a loan under the Downpayment Assistance Program.

 

What types of property can you purchase with a Homeownership Program loan?

The Homeownership Program requires that loan applicants purchase homes that meet specific property and sales price guidelines. 

  • Property Guidelines:

    In order to qualify for this program, the applicant must use the loan to purchase a home in which he or she will reside year-round.  The applicant may not use the loan to purchase recreational, vacation, investment, commercial or rental properties. No part of the purchased property may be designed for commercial purposes.  

    In addition, the property must meet one of the definitions listed below:

    • Existing and new single-family homes, townhouses and Planned Unit Developments
    • Newly constructed homes that meet FHA’s energy efficiency standards (Ask your Participating Lender for more information.)
    • Condominiums approved by FHA, VA or Fannie Mae
    • Two- to four-family homes that have been used as residences for the past five years or newly constructed, two-family homes in a Targeted Area 
    • Mobile homes that meet FHA guidelines.
       
  • Sales Price Guidelines:
    In order to qualify for this program, the purchase price of a home must not exceed the CHFA sales price limit established for the specific city or town in the state where the property is located.  (See, the CHFA sales price limits.)

 

What else should you know about a Homeownership Program loan? 

The following additional considerations and restrictions apply to Homeownership Program loans.

  • You may qualify for help with your down payment and closing costs.
    For those who lack sufficient funds to cover the upfront expenses associated with purchasing a home, CHFA offers assistance to qualified borrowers through the Downpayment Assistance Program (DAP).   

    Borrowers under the Homeownership Program may qualify for a reduced interest rate on a DAP loan.  

    Please note:  A down payment of at least 3.5 % of the purchase price of the home is typically required by the mortgage insurer.  

  • Mortgage insurance may be required.
    Loans originated under government program types must be insured by the Federal Housing Administration (FHA), the Veterans Administration, or the USDA Rural Development.  

    Conventional Loans are originated under the CHFA HFA Preferred loan program.  These mortgages, if originated with Loan to Value (LTV) ratios > 80%,  must be insured by Private Mortgage Insurance (PMI).   

    Mortgage insurance is not required when a borrower makes a down payment of at least 20% of the total purchase price of the home.  These loans are originated under the CHFA HFA Preferred tm Uninsured Loan Program.  
     
  • You may be required to pay a special federal tax if you sell your home within nine years.
    Under rare circumstances, CHFA mortgage loans may be subject to the Federal Recapture Tax at the time the property is sold.  The tax might apply if a borrower sells his or her home within nine years of the purchase date, makes a profit on the sale and has an income that exceeds federal recapture tax limits at the time of the sale.  You may be eligible to receive reimbursement from CHFA if you are required to make the Federal Recapture Tax payment.
     
  • You will need to complete a homebuyer education class.
    Prospective borrowers under the Homeownership Program are required to attend a free three-hour, homebuyer education class prior to closing the loan. Classes are held at several locations in the state each month. (See, homebuyer education class schedule.)

 

How do you apply for a Homeownership Program loan?

To apply for a Homebuyer Mortgage Program loan, a prospective borrower should contact one of CHFA’s Participating Lenders for guidance through the loan application process.  

Generally, the time from applying for the loan to closing the sale of the property is six to eight weeks.


 

Questions? Contact CHFA. 

Prospective borrowers should first contact their lender for information on this loan program.  For additional assistance, borrowers may contact CHFA’s single family underwriting department.

Phone:     (860) 571-3502
Fax:(860) 571-3550
Email:sfaminquiry@chfa.org


Mailing Address:
CHFA
Attn: Single Family Underwriting
999 West Street
Rocky Hill, CT 06067-4005


 

Additional Information

The following documents are related to the Homeownership Program.  To open and view the document, click on the document title. 

Related Documents Found: 14  matches     Displaying: 1 - 14 
FileSizeType
018 Borrower Signature Affidavit 014-0718 8-2017
This form must be completed by all borrowers executing closing documents on CHFA first and second mortgage loans. Form must be included in all loan closing packages delivered to CHFA loan servicers on and after September 4, 2017.
358Kpdf

059 Income and Sales Price Limits - 064-0308 Rev 6-2017r
This manual provides information regarding the CHFA Loan Programs available with underwriting overlays, credit scores, applicable servicers and more.
195Kpdf

Counseling Class Online - Homebuyer Registration Instructions Rev 10-17-17
Instructions for registering for the "FREE" CHFA Online Pre-Closing Homebuyer Education offered thru eHome America.
997Kpdf

Counseling Class Online - Lender Registration Instructions Rev 8-16
Lender Instructions for obtaining a loan origination system (LOS) "coupon code" for CHFA borrowers to use in registering for "Free of Charge" Online Homebuyer Counseling thru CHFA ehome America website.
727Kpdf

Counseling Class Schedule - 8 Hour Pre-Purchase Education Class - 1Q 2018
This chart list the 1st quarter class schedules for the Pre-Purchase Education classes. These classes are available to prospective homebuyers.
105Kpdf

Counseling Class Schedule - 8 Hour Pre-Purchase Education Class - 4Q 2017
This chart list the 4th quarter class schedules for the Pre-Purchase Education classes. These classes are available to prospective homebuyers.
222Kpdf

Counseling Class Schedule - 3 Hour Pre-Closing Education Class - 1Q 2018
This chart list the 1st quarter schedules for the Pre-Closing Education classes. These classes are available to homebuyers who have a reservation loan number for a CHFA loan.
102Kpdf

Counseling Class Schedule - 3 Hour Pre-Closing Education Class - 4Q 2017
This chart list the 4th quarter schedules for the Pre-Closing Education classes. These classes are available to homebuyers who have a reservation loan number for a CHFA loan.
94Kpdf

Counseling Class Schedule - Financial Fitness - 1Q 2018
This chart list the 1st quarter Financial Fitness couseling available to homeowners and homebuyers. This program is required for clients accepted into the Mortgage Crisis Job Training Program and is available to other clients.
87Kpdf

Counseling Class Schedule - Financial Fitness - 4Q 2017
This chart list the 4th quarter Financial Fitness counseling available to homeowners and homebuyers. This program is required for clients accepted into the Mortgage Crisis Job Training Program and is available to other clients.
82Kpdf

Counseling Class Schedule - Landlord Class - 1Q 2018
This chart list the 1st quarter schedules for the Landlord Education classes. This class is required for the purchase of a 2-to-4 family home financed by CHFA. It is also available to any potential 2-to-4 family homeowner.
91Kpdf

Counseling Class Schedule - Landlord Class - 4Q 2017
This chart list the 4th quarter schedules for the Landlord Education classes. This class is required for the purchase of a 2-to-4 family home financed by CHFA. It is also available to any potential 2-to-4 family homeowner.
90Kpdf

Program Brochure - Homeownership Mortgage Program (Spanish) 7-3-14
This is brochure gives an overview of the Homeownership Program.
473Kpdf

Program Brochure - Homeownership Mortgage Program 7-3-14
This brochure gives an overview of the CHFA Homeownership Program.
270Kpdf
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Found: 14  matches     Displaying: 1 - 14