What is the CHFA SmartStep Plus Program?
The CHFA SmartStep Plus Program is a 30-year fixed-rate mortgage offered by the Colorado Housing and Finance Authority (CHFA). It is designed to assist both first-time and non-first-time homebuyers in Colorado, providing affordable financing options.
Who is eligible for the CHFA SmartStep Plus Program?
Eligibility extends to both first-time and repeat homebuyers. Applicants must meet CHFA's income limits, which vary by county and household size, and the property must serve as the borrower's primary residence.
What types of loans are available under this program?
The CHFA SmartStep Plus Program offers 30-year fixed-rate loans, including FHA, VA, and USDA-RD options, allowing borrowers to choose the loan type that best suits their financial situation.
Is there down payment assistance available?
Yes, the program includes an optional CHFA Down Payment Assistance (DPA) Grant, which provides up to 3% of the first mortgage loan amount to assist with down payment, closing costs, and/or prepaid expenses. This grant does not require repayment.
Are there income limits for applicants?
Yes, income limits apply and vary based on county, household size, and loan type. It's essential to verify the current income limits for your specific situation to ensure eligibility.
What are the credit score requirements?
Borrowers are generally required to have a minimum credit score of 620. However, individual lender requirements may vary, and meeting the minimum score does not guarantee loan approval.
Is homebuyer education required?
Yes, all borrowers must complete a CHFA-approved homebuyer education course prior to loan closing. This ensures that buyers are well-informed about the responsibilities and processes involved in homeownership.
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Get Started NowWhat types of properties are eligible?
Eligible properties include single-family, one-unit residences, attached or detached homes, approved condominiums, modular homes, and manufactured homes on a permanent foundation. The property must serve as the borrower's primary residence.
Are there purchase price limits?
Yes, the program imposes purchase price limits that vary by county and household size. It's important to consult the current CHFA guidelines to determine the applicable limits for your desired location.
What is the minimum borrower contribution required?
Borrowers are required to contribute a minimum of $1,000 toward the purchase of the home. This contribution can come from the borrower's own funds or an acceptable gift.
Can the CHFA SmartStep Plus Program be combined with other assistance programs?
Yes, the program can be combined with other CHFA assistance programs, such as the CHFA Down Payment Assistance Grant, to further reduce out-of-pocket expenses for homebuyers.
Is there a prepayment penalty?
No, there is no prepayment penalty associated with the CHFA SmartStep Plus Program. Borrowers can make additional payments or pay off the loan early without incurring extra charges.
Can I use this loan for a second home or investment property?
No, the CHFA SmartStep Plus Program is intended for primary residences only. All borrowers must occupy the property as their primary residence.
Are non-occupant co-borrowers allowed?
No, all borrowers must occupy the property as their primary residence. Non-occupant co-borrowers and co-signers are not permitted under this program.
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Get Started NowWhat are the debt-to-income (DTI) ratio requirements?
The program has DTI ratio limits, which may vary based on credit score and loan type. Generally, a maximum DTI of 50% is allowed with a mid-FICO score of 620 to 659, and up to 55% with a mid-FICO score of 660 or above.
Is mortgage insurance required?
Depending on the type of first mortgage loan and the loan-to-value ratio, mortgage insurance may be required. Your lender can provide specific details based on your loan scenario.
Are there any fees associated with the program?
Standard loan fees, such as origination and processing fees, may apply. It's advisable to discuss all potential fees with your lender to understand the total cost of the loan.
What happens if I sell or refinance my home?
If you sell or refinance your home, any outstanding balance on the CHFA Down Payment Assistance Grant does not require repayment, as it is a true grant. However, any CHFA second mortgage loans would become due and payable.
How do I apply for the CHFA SmartStep Plus Program?
To apply, you must work with a CHFA-approved participating lender who will guide you through the application process, including verifying eligibility, assisting with necessary documentation, and explaining program requirements.
Is there a deadline to apply for the program?
There is no specific deadline to apply for the CHFA SmartStep Plus Program. However, program availability is subject to funding, so it's advisable to begin the application process as soon as you are ready to purchase a home.