The Colorado Household Financial Recovery (CHFR) Program is a debt consolidation program intended to serve unbanked or underbanked individuals (people who are either not utilizing banking services at all or are not utilizing them to their full capacity.)
This program will refinance up to $5,000 at a fixed 5% interest rate. The loan term can be up to 60 months; however, will depend on a variety of factors documented throughout the application process.
If this sounds like something you’re interested in, please continue reading for additional information or click the button below to be directed to the application form:
*Alternatively, you can also contact one of the Non-profit Colorado Partners mentioned below.
Eligible borrowers include individuals earning less than 120% AMI and falling within the definition of “Underserved Population” as defined by the State of Colorado.
*Borrower must be a U.S. citizen or otherwise legally in the United States on a permanent status and be a current resident of Colorado.
Borrower specific underwriting will evaluate credit measures including but not limited to:
*All components of loan structure, eligibility, and underwriting criteria are subject to lender approval and exceptions may be granted on a case-to-case basis.
*Impact Development Fund is an Equal Opportunity Lender
Full payoff and consolidation of the following credit accounts can be considered (must be in the name of the Borrower):
*All documentation must be an actual bill. Estimates are not acceptable.
Please work with the nonprofit organization staff for a complete list of eligible and ineligible expenses, if not specifically noted above.
Potential applicants will need to provide the following to apply:
The following local community agencies will provide direct-to-consumer financial coaching and application compilation for the program:
The following income sources CAN be used for loan qualification:
The following income sources CANNOT be used for loan qualification:
5.0% fixed rate
This loan’s APR is fixed at 5.0%, and there are no additional fees or hidden costs associated with the loan
Amount:
Up to $5,000 depending on Borrower’s AMI.
Term:
Up to 60 months depending on the size of the loan.
Fees:
No loan fees collected from the Borrower.
None
Monthly payments of principal and interest, collected via monthly ACH, check or money order or on IDF’s website portal. Loans will need to be a minimum payment of $25 per month.
Unsecured
Upon receipt of the documented and approved expenses, IDF will disburse funds directly to the debt holder/vendor. At the time of funding is a payoff to a vendor is less than the written payoff provided to IDF and unused funds will be applied to the loan as principal reduction.
All payment activity will be reported to TransUnion, Equifax, and Experian.
Yes, applicant’s income will be calculated using both their current household income and household size. This program will use the CHFA income limits table (see here). The individual applicant will be required to submit recent wages (last 60 days) and we will annualize this gross income forward 12 months to determine current annual gross income. The income will need to be submitted by the primary applicant; however, if there are other taxable contributors in their household, 60 days of their recent wages should be uploaded as well. This will help determine area median income (AMI). Because AMI is tied to the household’s total income, individuals will also be required to disclose their household size, which will be verified from the information on their most recent tax return (IRS Form 1040).
Yes, if the applicant does not have an SSN, they can provide their ITIN. This should be the same number uploaded on their tax return (unless their uploaded tax return was a redacted copy).
The program can issue loans for up to $5,000. Exact award amounts will be determined on a case-by-case basis. We can consolidate up to 5 separate bills per applicant, as long as the total amount is under $5,000.
IDF will obtain a credit report for each applicant. Credit scores will NOT be used to disqualify applicants.
There will be no upfront fees for application, processing, or during loan closing. There will be no ongoing fees, except in the case of a late payment.
The applicant will only need to provide IDF with their current address. If the applicant does not have a current address, they are unable to apply for the CHFR program.
Both. If the CBO is unsure if someone will qualify as being unbanked or underbanked, please utilize the “Unbanked and Underbanked Screening” tool helping applicant apply. IDF will verify that each applicant meets at least one of the unbanked/underbanked criteria.
Yes, applicants must be at least 18 years of age.
All these items will be required at the time of application to move forward in the process.
If the applicant did not file taxes for the most recent tax year, we will need the previous tax year and documentation regarding an approved extension for the current year. If the applicant did not live/work in the United States in the past tax year, we encourage them to apply in the future after establishing their tax status, so we are able to verify their income. As most people in this country are required to file taxes, we encourage immigrants with work authorizations to apply. Undocumented immigrants will not be eligible for this program.
Just the applicant/intended borrower will need to provide income documentation for the proof of recent income section. The unsecured note will be linked to one borrower, establishing one borrower’s credit history. However, to calculate the total income of the household for AMI eligibility, if both members of the household are not represented on the tax return (ex: married filing separately), the tax returns for both individuals should be provided.
Yes, since the loan is connected to one borrower, multiple eligible members of a household may apply.
We expect applications to have about a 2-week processing time, given applicants are quickly responsive to any additional questions and requests. This is subject to change once we have completed applications on hand and a better understanding of what applicant volume will look like. We will report a status of the volume of applications and provide average monthly processing times during the monthly CBO cohort meeting.
They will be prioritized at time of submission. However, in some cases, bills that are extremely past due and escalating quickly may be expedited, but this will be at the discretion of the organization based on overall application numbers.
Yes, if there is an assister on the application, they will be kept up to date through the point of loan closing. During loan management and loan close out/payoff, IDF will communicate directly with the borrower.
When discussing any personally identifiable information, including anything related to financial accounts, tax information, and more, IDF will require that the applicant be present. The applicant shall stay copied on any email correspondence and must be present during a call or meeting with IDF staff. A calendar to schedule meeting time in advance will be made available to CBOs, so they can coordinate times for IDF staff and the applicant to both be available and present. Alternatively, IDF staff can update the CBO assister on general status of application without the applicant present, except in the case that it reveals an applicant’s financial information.
No, the debt needs to be tied to one of the following: medical expenses or collections; vehicle debt, repair, or release from impounding; childcare or other family care expenses for dependents; payday loans and other loans (defined as predatory interest rates of 20% or higher); and utility expenses or collections. Please see below for more detailed descriptions of each of these categories.
Please note: Traffic violations and parking tickets will not be an approved expense.
This is a quick cash loan that does not report to credit agencies, has high loan fees, difficult repayment terms outside of standard lending practices within banking institutions, and predatory interest rates (defined here as 20% or higher).
No, this program is intended to serve unbanked or underbanked individuals. It is also meant to fully pay off qualifying debts linked to an invoice, bill, or payday loan.
No, CHFR funds will not be used for any costs directly related to housing. We suggest looking into local eviction prevention programs. This program will also not be used to fund building or repair for home expenses.
The general term sheet has been sent to CBOs. It will additionally be uploaded to the CHFR website, once launched in late summer. The specified terms for an individual borrower will be listed in their approval letter after underwriting is complete.
No, the length of the term will be determined on numerous factors including the loan total and AMI. All loans will have a minimum monthly payment of $25, so this may also affect shortening the length of the loan term.
No, some borrowers with lower AMIs may qualify for a lower amount. This is to ensure that the loan repayment remains reasonable and does not create a burden that would cause issues with inability to pay, thus hurting the borrower’s credit. IDF is refining the system of eligible amounts related to AMI and will advise CBO members.
No, borrowers cannot opt out of credit reporting. Credit reporting is a function of the program as it is intended to build credit history through on-time payments.
Yes, the interest on the loan will always be 5% and will remain fixed at 5% throughout the loan term.
No, we are not a depository. For physical forms of payment, IDF will accept both checks and money orders.
If the applicant does not have a checking account to submit payment via check, we will accept payment in the form of a money order. As we are not a depository, we cannot accept cash as a form of payment.
Monthly payments will vary depending on the size of the loan; however, the monthly payment itself will be determined at closing and will never differ throughout the term. There will be a minimum monthly payment of $25 per month.
IDF is currently building a system for payment to be submitted electronically. We expect this to be up and running by late 2024. All CBOs will be alerted when this is launched.
Payments will be due on the 5th of the month. There will be a 10-day grace period for borrowers. If payment is not received by the 16th, a minimal $5.00 late fee will be assessed. IDF program staff will attempt 3 outreach attempts to borrower before late fee is initiated.
The Impact Development Fund underwriter will request any updated bills while the file is being reviewed. Depending on the debt and the vendor, the amount may be changing frequently with assessed late fees or escalating interest, the final debt amount will be determined with the vendor when a Demand for Payoff statement is approved and set for the closing date to ensure any additional monies or fees are captured and included in the full loan amount.
The underwriter will initially approve an estimated amount of loan based on expectations of which credit accounts will be paid off. After the approval is signed by the applicant, the underwriter will work to confirm payoff amounts and paperwork related to the Demand for Payoff. These amounts will be included in initial disclosures, which will showcase the final amount of the loan prior to closing.
No, this is not intended to be a cash resource and we do not want to add additional debt.
No, we encourage the CBO to support the applicant with financial education and resources; however, this will not be a requirement of entering the program. There will also be no ongoing financial education requirements during the duration of the loan; however, IDF will partner with CBOs to encourage ongoing financial education through communications.
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