What is a CHFA Loan?

What is a CHFA Loan?

CHFA financing is done through Connecticut Housing Finance Authority and offers a variety of loan programs for first time homebuyers in Connecticut. Borrowers who have owned previously may also apply if they have not owned in the past three years or plan to buy in a Federally Targeted Area of Connecticut. CHFA offers 30-year, fixed-rate mortgages.

What are the requirements for a CHFA loan?

Here are requirements for CHFA lenders:

• Minimum down payment of 3.5%.
• Homebuyer Education by a CHFA-Approved Housing Counseling Agency.
• Must be a first time homebuyer, or buy in a Federally Targeted Area.
• You meet Sales Price Limits and Income Limits for the town your are looking in.

PROS of a CHFA Loan

A big benefit of a CHFA loan is below-market interest rates. Interest rates are also less impacted by credit score than other types of loans. In addition, Downpayment Assistance Program (DAP) can cover down payment costs for those who qualify, and gift funds can also be used.

CONS of a CHFA Loan

While interest rates are low and credit scores can be less than excellent, not everyone qualifies for a CHFA loan. You must be a first time homebuyer or have not owned in the past three years, and you must meet limits on the sales price of the home and the household income.

Finding the best loan for your personal needs can be overwhelming. New England Home Mortgage strives to help you understand all your options and find the best fit for your financial situation. Read an overview of our mortgage options here, or contact us today for an in-person appointment.