CHFA eNews: Home Finance
chfa enews - home finance 
March 16, 2017

disclosures for chfa second mortgages

CHFA will now permit Participating Lenders to generate their own Loan Estimate and Closing Disclosure for CHFA Second Mortgage Loans. Participating Lenders may choose whether they use the forms made available by CHFA or those generated by their LOS.

If you use your own Loan Estimate and Closing Disclosure, please include the following:
  • Loan Amount section
    List the CHFA Second Mortgage Loan amount.

  • Loan Terms table
    Under the subheading “Does the loan have these features,” disclose YES for the Balloon Payment and also disclose the amount of the balloon payment and the due date of such payment.

    Example: “You will have to pay $5700 at the end of year 30.”

  • Projected Payments table
    Under the Principal and Interest and Estimated Total Monthly Payment, disclose the scheduled balloon payment or final payment reflecting the principal amount of the loan as disclosed on the Note.

  • Cash to Close tables
    Per program requirements, the borrower may not receive cash back on the CHFA Second Mortgage Loan. Therefore, cash back should not be reflected on the Second Mortgage Loan Estimate and Closing Disclosure.

  • Additional Information About This Loan table
    • Assumptions (Loan Estimate and Closing Disclosure): Mark the box for “will not allow assumption of this loan on the original terms.”

    • Partial Payments (Loan Estimate and Closing Disclosure): Mark the box for ”may accept payments that are less than the full amount due (partial payments) and apply them to your loan.”

    • Negative Amortization (Closing Disclosure): Mark the box for “do not have a negative amortization feature.”
CHFA relies on its Participating Lenders to complete the CHFA Second Mortgage Loan Estimate and Closing Disclosure in compliance with TRID requirements. Please refer to the TILA-RESPA Integrated Disclosure Rule and Official Interpretations, and consult with your compliance or legal departments for additional information and guidance in completing required disclosures.

If you would like to use CHFA Second Mortgage Loan disclosures, these forms will continue to be available on the CHFA website and in HomeConnectionsm.

please note

Participating Lenders must use CHFA Form 305, CHFA Second Mortgage Loan Promissory Note, and CHFA Form 310, CHFA Second Mortgage Loan Deed of Trust, for all CHFA Second Mortgage Loans.

CHFA Home Finance
303.297.7376 or 888.320.3688 Denver
970.241.2341 or 800.877.8450 Western Slope

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