Step-by-step guide to Chenoa Fund from pre-qual through closing — 3.5% vs 5% pathways, DPA Edge forgiveness, and repayable second-lien options.
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Chenoa Fund
How Does Chenoa Fund Work?
From pre-qual through closing, Chenoa layers a second mortgage on your FHA 203(b) first loan — delivering 3.5% or 5% toward down payment or closing costs via a forgivable or repayable structure.
Four milestones every Chenoa-assisted purchase follows.
The assistance percentage depends on how much help you need at closing on your FHA 203(b) purchase.
3.5%
The most common pairing with FHA 203(b). On a $350,000 home, that is $12,250 — enough to cover FHA's minimum down payment so you may bring little or no cash to closing.
Also used when you need help offsetting FHA closing costs after the 3.5% down is covered.
5%
Higher assistance for buyers who need more help at the table. On a $400,000 home, 5% equals $20,000 toward down payment or closing costs.
Often used when FHA closing costs would otherwise drain your reserves after the minimum down payment.
Your second-lien structure determines whether you make monthly Chenoa payments and when assistance is forgiven.
Forgivable
0% interest — no interest charged on assistance
No monthly payment on the Chenoa second mortgage
Forgiven after 36 consecutive on-time first-mortgage payments
Repayable
10-year fixed repayment term
Fixed, competitive interest rate at origination
Monthly Chenoa payment alongside your primary mortgage
Related Chenoa guides and loan programs to compare before you apply.
Ryan & Steve will map your pre-qual through closing — including which Chenoa structure fits your timeline and budget.
Chenoa Fund is a registered trademark of CBC Mortgage Agency. All programs are subject to borrower qualification and lender approval. This website is not directly affiliated with or endorsed by HUD, FHA, or the CBC Mortgage Agency.