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Section 8 Housing Choice Voucher Homeownership Program

Overview

Program Overview

The Section 8 Housing Choice Voucher Homeownership Program offers home loans at below-market interest rates to Section 8 tenants who wish to purchase their own homes.  This program allows eligible borrowers to use their Section 8 Housing Choice Vouchers towards a monthly mortgage payment.   

CHFA is committed to helping Connecticut residents achieve their dream of homeownership and values its partnership with local Public Housing Authorities (PHAs) across Connecticut as well as the qualified lender for this program.  Applicants interested in the Section 8 Housing Choice Voucher Homeownership Program should contact their PHA directly (See, State List of PHAs.)  They may also contact the McCue Mortgage Company directly.

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

 

Section 8 Housing Choice Voucher Homeownership Program Interest Rates

Currently, the Section 8 Housing Choice Voucher Homeownership Program is providing mortgages  at the following rate:

    • Interest rate: 3.525%** (APR range 3.625 - 4.025%)
    • Fees: Origination Fees Payable to Lenders: 3.525% Rate - 1% Point; 3.625% Rate - .75% Point; 3.725% Rate - .50% Point; 3.875% Rate - 0.00% Point
    • Term: 30 years, fixed rate

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


 

Who can apply for a Section 8 Housing Choice Voucher Homeownership Program loan?

  • Applicants must be referred by their Public Housing Authority (PHA)
    Eligible borrowers under this program are Section 8 voucher holders who have been approved by their local Public Housing Authority (see, state list of PHAs) to participate in this program. This approval process includes assessments by counseling and credit services that will determine whether applicants are ready to purchase a home.
      
  • Applicants must be first-time homebuyers or prior homeowners purchasing in targeted areas of the state.
    Eligible borrowers must be first-time homebuyers or cooperative members who meet minimum credit, income and employment standards. In addition, people who have owned homes before may also qualify for a loan under this program if they plan to purchase a home located in one of 18 designated 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 the CHFA statewide income limits of $89,200 for households for one or two persons or $102,580, for households of three or more.  Household income is calculated by combining the income of all resident adults, 18 or older, who are not full time students.

 

What types of property can you purchase with a Section 8 Housing Choice Voucher Homeownership Program loan?

The Section 8 Housing Choice Voucher 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 listed on FHA's Approved Condominium List
    • 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 Section 8 Housing Choice Voucher Homeownership Program loan? 

The following additional considerations and restrictions apply to Section 8 Housing Choice Voucher 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 Section 8 Housing Choice Voucher 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.
    A Section 8 Housing Choice Voucher Homeownership loan may be insured either through the Federal Housing Administration (FHA), the Veterans Administration, the USDA Rural Development or through private mortgage insurance (PMI).

    (Your Participating Lender can provide more detailed information on the mortgage insurance options under this 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 will need to complete a homebuyer education class.
    Prospective borrowers under the Section 8 Housing Choice Voucher 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 Section 8 Housing Choice Voucher Homeownership Program loan?

Prospective borrowers of the Section 8 Housing Choice Voucher Homeownership Program should contact their local PHA for an initial assessment of their eligibility and a determination of the estimated housing assistance payment they qualify for.  (See, State List of PHAs.) The PHA will refer eligible borrowers to the CHFA-qualified lender, The McCue Mortgage Company, who will guide applicants through the 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 PHA or 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:singlefamilyunderwriting@chfa.org


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


 

Documents related to the Section 8 Homeownership Voucher Program

The following documents are related to the Section 8 Homeownership Voucher Program.  To open and view the document, click on the document title. 

Related Documents Found: 5  matches     Displaying: 1 - 5 
FileSizeType
Federal Recapture Tax Limits
This chart lists the threshold income limits for Federal Recapture Tax liability based on geographic location of the home and the number of years of ownership.
128Kpdf

CHFA Homebuyer Mortgage Programs Brochure (Spanish)
This brochure provides an overview of the CHFA Homebuyer Mortgage Program, the Downpayment Assistance Program and the Rehabilitation Mortgage Loan Program.
1823Kpdf

CHFA Homebuyer Mortgage Programs Brochure
This brochure provides an overview of the CHFA Homebuyer Mortgage Program, the Downpayment Assistance Program and the Rehabilitation Mortgage Loan Program.
1772Kpdf

Section 8 Homeownership Program Brochure
This brochure contains an overview of the CHFA Section 8 Homeownership Program.
372Kpdf

Listing of Targeted Areas with Census Tracts
This is a listing of Tarted Areas with Census Tracts in conjunction with CHFA Homebuyer Programs.
9Kpdf
FileSizeType
Found: 5  matches     Displaying: 1 - 5