The investor market is concerned about the credit quality of homebuyers. CHFA is no exception to these concerns. Please be reminded that CHFA reserves the right to credit review all loans and can decline any loans that CHFA does not view as a prudent investment (see Sellers Guide Chapter 5, Section 500 Program Compliance Review).

Certain loan characteristics will trigger a “closer look” by CHFA during the Compliance review:

• Low credit scores for borrowers, co-borrowers and co-signors.
• Excessive unpaid collections and/or paid judgments.
• DTI greater than 45% on automatically underwritten and approved loans.
• Manually underwritten loans with compensating factors that do not clearly conform to the compensating factor guidance issued by the mortgage insurer or guarantor.
• Alternative credit developed by the lender rather than by a commercial credit reporting agency.
• Previous bankrupt borrowers.
• AUS conditions that are not cleared by the lender's underwriter and/or are not fully documented.

Loans that possess these characteristics could take up to the full three business days for the Compliance review. Lenders can facilitate the review by ensuring loans are accurately documented and fully documented before submitting the loans to CHFA.

Please contact us with any questions.

303.297.7376 or 1.888.320.3688 Denver
970.241.2341 or 1.800.877.8450 Western Slope

Thank you,
CHFA Home Finance