Frequently Asked Questions

Section 3 - For Participating Lenders

Q. How do I become a participating lender and servicer
for CHFA programs?
A. Contact the Single Family Underwriting
Dept. @ (860)-571-3502.
Criteria sheets are also available for your information:
How to become a Participating Lender and How to become a Correspondent Lender (both on one pdf file)

Q. What are your income limits and sales price limits?
A. click here for sales price and income limits

Q. What is your current interest rate, terms and points?
A. click here for Current rate and terms

Q. How is the household income calculated for qualifying income limit purposes?
A. All sources of income are utilized for determining the household income for income limit purposes including but not limited to, regular earnings; overtime; part-time earnings; unemployment compensation; bonuses; dividend and interest income; child support; commissions income; military allowances; welfare payments; disability payments; pension; annuity; retirement; and social security benefits; and income for services in the military reserve or National Guard. Income from all adult (other than full time students) members of the household (occupants 18 years or older) will also be included for income limit purposes. When the borrower is purchasing a two-to four unit property, 100% of the market gross rental income for the rental units will be counted towards the income limits. Also, income from any employment within the last 90 days of the employment date may be used for income limit purposes.

Q. How do I know if a condominium is approved by CHFA?
A. CHFA has a list of eligible condominiums. You must also be sure the condominium is approved for mortgage insurance or guarantee by a private mortgage insurer (PMI), the Federal Housing Administration (FHA), the Veterans Administration (VA), Rural Development (RD) or by Fannie Mae depending on how the mortgage will be insured or if it is uninsured.

Q. What is Recapture Tax and how does that work?
A. Recapture Tax

Q. Do all CHFA loans have to be government insured?
A. The of insurer or guarantor of a CHFA loan must be the Federal Housing Administration (FHA), the Veterans Administration (VA) or Rural Development (RD) unless the borrower has a 15% down payment in which case private mortgage insurance may be utilized, a 20% down payment in which case the mortgage may be uninsured, the loan is for newly-constructed housing or a condominium that has not yet been approved by a government insurer or guarantor.

Q. What are your underwriting ratios?
A. CHFA accepts the mortgage insurer or guarantors ratios for underwriting. In the case of an uninsured loan the lender will follow Fannie Mae guidelines.

Q. What are your guidelines regarding credit and/or bankruptcy?
A. CHFA accepts the mortgage insurer or guarantors guidelines for underwriting. In the case of an uninsured loan the lender will follow Fannie Mae guidelines.

Q. Are co-signers allowed?
A. No. A CHFA loan can only be made to owner occupants, therefore a co-signer can not be allowed.

Q. What are the requirements for hazard insurance?

A.

1) Policies may contain a deductible clause up to $1,000.
2) All policies must contain or have attached a standard mortgagee clause naming the “Loan Servicer” and its successors and assigns as their interests may appear. The following abbreviations are acceptable: AISOA or ALTIMA C/O “Loan Servicer”.

Please refer to Section 6.3 of the Operating Manual for further clarification.