Last week I posted a blog updating some of the changes to Connecticut Housing Finance Authority (CHFA) since my previous post. This post covered most of the requirements for CHFA Loans as well as additional programs that they have. The danger of writing a post like this is that it covers so much, that it is very easy to miss some very important points that most do not know, or have a misconception about. The reason why I included so much in that blog is because I wanted a blog that a Borrower could go to, and read all about CHFA in one place without having to search around and jump from one screen to another.
The purpose of this blog and possibly others to follow, is to just pull out one of the features of CHFA that is commonly misunderstood, or not know, which could have easily been overlooked when reading the more inclusive blog.
One of the major misunderstandings about CHFA is that it is JUST for First Time Homebuyers. A First Time Homebuyer is defined as someone who has not owned a property in the last three years. While CHFA’s major purpose and focus is to provide mortgage loans for First Time Homebuyers, there is a situation in which it can also apply to non first time buyers.
CHFA has designated 5 towns (Bridgeport, Hartford, New Haven, New London, and Waterbury) as Targeted Areas, and portions of 13 other towns (Ansonia, Danbury, Enfield, Groton, Meriden, Middletown, New Britain, Norwalk, Norwich, Rocky Hill, Stamford, Torrington, Windham) as Targeted Areas. If a Buyer purchases a property within any of these areas, and meets CHFA’s Income and Sales Limits, they can apply for a CHFA Mortgage even if they are not a First Time Homebuyer. However, it DOES have to be the only property that they presently own, they cannot own a property that they plan on keeping, and then purchase another property with a CHFA Loan. Also since CHFA further reduces their already below market interest rate by .25% for properties within the Target Area, they qualify for the reduced rate as well.
This is not commonly known by many Loan Officers in Connecticut, and as a result many non first time buyers who have qualified for CHFA Mortgages in the past, have not taken advantage this. Hopefully those who are reading this blog will not make that same mistake.
I plan on following this blog with another one to clarify anther misstated perception about CHFA Loans, so keep an eye out for it.
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Info about the author:
George Souto is a Loan Officer who can assist you with all your FHA, CHFA, and Conventional mortgage needs in Connecticut. George resides in Middlesex County which includes Middletown, Middlefield, Durham, Cromwell, Portland, Higganum, Haddam, East Haddam, Chester, Deep River, and Essex. George can be contacted at (860) 573-1308 or gsouto@mccuemortgage.com
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