By: Carrie Niess
Colorado Housing and Financing Authority (CHFA) is Colorado’s trusted partner for affordable and responsible homeownership. Through participating lenders like American Financing, Coloradans have access to CHFA home purchase and refinance loans. These loans have competitive fixed rate financing and may offer down payment or closing cost assistance.
While first-time homebuyers tend to be CHFA’s most frequent customers, with 56% of its 2016 borrowers being Millennials, the agency also serves Gen X and multi-generational families looking for their next home.
As with any home loan, borrowers can choose where they want to buy. There are no limitations to specific housing inventory. The agency says its average loan is for $225,000 while noting that many borrowers have been approved for new or near-new $300,000 homes. CHFA-backed originations can be found throughout the metro area with Aurora, Denver, Colorado Springs, Thornton, Commerce City and Greeley producing the most volume. Like a lot of the Denver area, these cities have significant new home construction.
First-time homebuyers Scott and Heather MacPherson purchased their home for their young, growing family with the help of a CHFA loan. “Rent is so expensive, and we’d rather invest in something that is our own so we can build equity,” Heather said.
So is CHFA assistance for you? Below we’ve broken down the benefits, qualifications, and requirements into three categories. Read on to see if there’s a fit:
Limited savings, low income, or fair credit scores?
You may still be able to become a homeowner.
- CHFA’s program is often promoted to first-time homebuyers, but is available to anyone provided they fall within specific income and purchase price limits (PDF). These limits vary by county and household size.
- Acceptable credit scores vary based on which CHFA loan program you choose. Typically, the program requires a mid-credit score minimum of 620.
- Down payment assistance is available. This can help Coloradans get into a home for as little as $1,000 down.
- Closing cost assistance is available. Lenders can receive a credit in the amount of 1% of the borrower’s first mortgage loan payment. This allows borrowers to use the credit to cover closing costs.
Want choices on who to finance with?
You have options. Combined, participating CHFA lenders have helped 88,695 Coloradans purchase a home.
- CHFA is the loan servicer. That means they take over the loan after you complete the mortgage process with a participating CHFA lender.
- American Financing has two of the top 10 producing CHFA loan closers in the Denver Metro area, and four total in the top 20 producers, going by data from the fourth quarter of last year.
Worried about closing, taxes, or even the unknowns post-purchase?
As a CHFA borrower, you will take a homebuyer education class to prepare for the responsibilities of homeownership.
- Attend homebuyer education classes in-person or online.
- If taken online, there is a $99 fee, and $50 for each additional co-borrower.
- Classes are required and must be completed before closing on a home purchase.
- CHFA curriculum includes (PDF): discussions about successful money management, key players in the homebuying process, the inspection and appraisal process, and types of mortgages, among other topics.
“The homebuyer class was very helpful. CHFA really tries to help people make informed decisions and further understand the homebuying process,” the MacPhersons said.
Now that you have a better idea of CHFA benefits, let’s not forget, it’s important to work with an experienced and knowledgeable CHFA participating lender.
First-time homebuyer Kenny Earl credits his positive CHFA loan experience to American Financing. “My mortgage consultant walked me through loan options and explained each step of the process in detail.” Kenny added, “I didn’t know what to expect when buying a home. My first call discussed what I’d have to put down, what monthly payments would look like. The rep I worked with answered all my questions right up front. It made the rest of the process easy and painless.”
Carrie Niess is a copywriter for American Financing, a national company employing salary-based mortgage consultants dedicated to helping homeowners make smart mortgage decisions that align with their unique financial goals.