Home Purchase

CNE achieves its mission by targeting local neighborhoods with potential for improvement and encouraging renters to become homeowners through its home purchase loan department. Qualifying Chattanooga residents are able to buy a home through CNE's financing programs in conjunction with FHA, Fannie Mae, Freddie Mac, and the Tennessee Housing Development Agency. Additionally, CNE provides educational seminars such as "FASTRAK® to Homeownership," which ensure that its clients have all the tools necessary to become responsible homeowners.

Second Mortgage Program

CNE offers the Second Mortgage Program that is designed to provide down payment assistance for Chattanooga residents buying a home. The loan's interest rate varies from two to four percent, and the Second Mortgage loans can be used in conjunction with a mortgage arranged by CNE or by another lender or financial institution.
All of CNE's home purchase programs are available under the Affordable Housing Assistance program (AHA). CNE works closely with many local Banks and Mortgage Companies. CNE also makes second mortgages when an approved outside lender finances the first mortgage.

Products:

Affordable Housing Assistance (AHA)
Amortizing 2nd Mortgage
Federal Funds

Maximum Mortg. Amt: up to 20% of sales price

Interest Rate: 2% <THDA Great Rate

Term: 30 years

Income Restriction: <=80% Area Median Income (AMI)
(household income)

Area: Citywide

Property Restrictions: Primary Residence
No tenant occupied properties
Pass Section 8 HQS Inspection
Mkt value <=95% FHA SF loan limit

Use: Down Payment/closing costs
Principal reduction

Affordable Housing Assistance (AHA)
Title Transfer 2nd Mortgage
Federal Funds

Maximum Mortg. Amt: $25,000 - $50,000

Interest Rate: 0% - no monthly payment
(no interest accrued)

Term: Loan repayment upon resell/Title
Transfer

Income Restriction: <=80% Area Median Income (AMI)
(household income)

Area: Designated properties in city limits

Property Restrictions: Primary Residence
No tenant occupied properties
Pass Section 8 HQS Inspection
Mkt value <=95% FHA SF loan limit

Use: Down Payment/closing costs
Principal reduction

Forgivable 2nd Mortgage
Non-Federal Funds

Maximum Mortg. Amt: Usually $5,000-$15,000

Interest Rate: 0% - no monthly payment

Term: 5 years – forgiven over 5 yrs
(ArtsMove, FN, JH, MLK, UTC)
5 years – forgiven after 5 yrs
(CIC)

Income Restriction: No income restriction

Area: Designated areas or properties

Property Restrictions: Primary Residence for 5 years

Use: Down Payment/closing costs
Principal reduction

ArtsMove, Community Impact of Chattanooga (CIC), Ft. Negley (FN), Jefferson Heights (JH), MLK Tomorrow (MLK), UTC

NOTES: ArtsMove – earn living in the artistic field
Areas: W Main/E Main St
Cowart Area
Fort Negley Area
Jefferson Heights Area
ML King Area
UTC – remain full time employee of UTC
Area: Surrounding UTC
CIC - Area: Churchville
Orchard Knob
Glenwood

Affordable Housing Assistance (AHA)
Amortizing 2nd Mortgage
Non-Federal Funds

Maximum Mortg. Amt: up to 10% of sales price

Interest Rate: 2% <THDA Great Rate up to 6%

Term: 30 years

Income Restriction: <=115% Area Median Income (AMI)

Area: Citywide

Property Restrictions: Primary Residence

Use: Down Payment/closing costs
Principal reduction

Note: if Memorial Employer Assisted 2nd mortgages – must be employed full time - receive a $400 grant to assist with closing costs

Section 8 to Homeownership
Amortizing 2nd Mortgage
Federal Funds

Maximum Mortg. Amt: up to $25,000 – based on Section 8
voucher amount

Interest Rate: 4%

Term: 10 years

Income Restriction: <=80% Area Median Income (AMI)
(household income)

Area: Citywide

Property Restrictions: Primary Residence
No tenant occupied properties
Pass Section 8 HQS Inspection
Buyer obtains Home Inspec.
City Home Inspection – pd by city
Mkt value <=95% FHA SF loan limit

Use: Down Payment/closing costs
Principal reduction

Possible combinations of 2nd mortgages
Using Forgivable Loans

MLK Tomorrow & UTC
MLK Tomorrow & Title Transfer
MLK Tomorrow & Amortizing Federal
MLK Tomorrow & Amortizing Non-Federal
MLK Tomorrow & Section 8

CIC & Amortizing Federal
CIC & Amortizing Non-Federal
CIC & Section 8

FT Negley & UTC
FT Negley & Title Transfer
FT Negley & Amortizing Federal
FT Negley & Amortizing Non-Federal
FT Negley & Section 8

Jefferson Heights & UTC
Jefferson Heights & Title Transfer
Jefferson Heights & Amortizing Federal
Jefferson Heights & Amortizing Non-Federal
Jefferson Heights & Section 8

ArtsMove & UTC
ArtsMove & Title Transfer
ArtsMove & Amortizing Federal
ArtsMove & Amortizing Non-Federal
ArtsMove & Section 8