RD Instruction 2000-NNN

PART 2000 - GENERAL

Subpart NNN - Memorandum of Understanding (MOU) to Enhance Mortgage
Lending on American Indian Lands

§ 2000.3251 [Purpose]{.underline}.

An Executive Memorandum dated August 6, 1998, directed the Secretaries
of the U.S. Departments of Housing and Urban Development (HUD) and the
Treasury to development recommendations to help streamline mortgage
lending in Indian Country. These recommendations have been developed
into a report entitled "One-Stop Mortgage Center Initiative in Indian
Country". This report in its entirety can be obtained on the HUD Web
Page at
[www.codetalk.fed.us/ONEStopSet.html](http://www.codetalk.fed.us/ONEStopSet.html).
Historically, Federal agencies have required tribal governments to adopt
different lease documents and mortgage codes for participation in each
Federal single-family loan program. As a result of the "One Stop
Mortgage Center Initiative in Indian Country" report, a model
interagency lease, mortgage codes (foreclosure and eviction codes and
priority-of-lien procedures), and a tribal application approval process
were developed that are acceptable to HUD, United States Department of
Agriculture-Rural Housing Service (USDA-RHS), the Department of Veterans
Affairs (VA), and the Bureau of Indian Affairs (BIA). (HUD, VA, and RHS
are collectively referred to as the Federal Agencies.) The purpose of
this Instruction is to define the role of USDA, acting through the Rural
Housing Service (hereinafter referred to as the "USDA") for the
implementation of this initiative in accordance with the MOU attached as
Exhibit A. This Instruction will provide guidance for the review,
approval, and recordation of Tribes wishing to participate in the "One
Stop Mortgage Center Initiative in Indian Country".

§ 2000.3252 [Implementation]{.underline}.

Any federally recognized American Indian or Alaska Native Tribe seeking
to participate in any Federal Agency single family housing loan programs
may submit the required documentation noted below to any one of the
Federal Agencies listed in the MOU (Exhibit A).

\(a\) [USDA's responsibility]{.underline}. Please make all of the
documents available to the Tribes, Tribal Organizations, private
lenders, as well as other parties interested in single family mortgage
financing on Tribal lands.

\(1\) When an applicant Tribe has adopted without modification the Model
Tribal Lending Procedures for Lien Priority, Eviction and Foreclosure
and Leasing (Exhibit A, Attachment 1) and the Model

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

DISTRIBUTION: WSDC Administration

General

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RD Instruction 2000-NNN

§ 2000.3252 (a)(1) (Con.)

Lease (Exhibit A, Attachment 2), and submits the Model Documents along
with the required information contained in the checklist (Exhibit A,
Attachment 4) to a Rural Development State or Local Office, they are to
be immediately forwarded to the National Office per the MOU (Exhibit A).
The National Office will review, approve, and process the Model
Documents, per Exhibit A, paragraph 3 or 4, depending on whether they
are submitted as drafted or whether they contain modifications or an
addendum. Upon approval by the National Office, the State Director will
be authorized to enter into the Memorandum of Understanding Between the
Tribe and the Agency (Exhibit A, Attachment 3). The National Office will
be responsible for the distribution of the executed Model Documents per
the MOU (Exhibit A).

\(2\) Copies of any Leases and MOU's that are approved between a Rural
Development Office and a Tribe for mortgage financing, be it prior to or
after the date of this instruction, should be forwarded to the National
Office of the Rural Housing Service, Attn. Native American Coordinator,
1400 Independence Ave. SW, STOP 0701, Washington DC 20250. All Tribes
who have an approved Lease and MOU for single family mortgage financing,
whether for the "One Stop Initiative" or individually by a Federal
agency, will be maintained on the HUD Web site at
[www.codetalk.fed.us]{.underline}.

\(b\) [HUD, FHA, VA Responsibilities]{.underline}: Model Documents that
are received and approved by another Federal Agency of the MOU, will be
distributed to the other participating agencies. If the Model Documents
were approved with no modifications or addenda, they will be accepted by
the Rural Development National Office and distributed to the respective
State Office having SFH loan jurisdiction with the Tribe. If a Tribe has
made modifications to the Model Documents, each agency will make its own
review of the Model Documents for acceptability and approval.

§ 2000.3253 [Handling of Tribal Leases other than "One Stop Mortgage
Initiative" Model Documents]{.underline}.

This instruction is not intended to preclude a Tribe from using lease
forms other than the "One Stop Mortgage Initiative" Model Documents.
When a Rural Development State or Field Office is working with a Tribe
who is utilizing a lease and related documents that are other than the
basic "One Stop Initiative" Model Documents, they should work with their
local Office of

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RD Instruction 2000-NNN

§ 2000.3253 (Con.)

General Counsel for review and acceptance of the conditions. The
National Office of the Rural Housing Service will be conducting the
approvals and processing of only the "One Stop Mortgage Initiative"
Model Documents.

§ 2000.3254 -- 2000.3300 \[Reserved\]

Attachment:

Exhibit A - Memorandum of Understanding to Enhance Mortgage Lending on

American Indian Lands

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RD Instruction 2000-NNN

Exhibit A

Page 1

MEMORANDUM OF UNDERSTANDING

**TO**

**ENHANCE MORTGAGE LENDING ON AMERICAN INDIAN LANDS**

This Memorandum of Understanding (MOU) is effective on January 9, 2001
among the U.S. Department of Agriculture (USDA), U.S. Department of
Housing and Urban Development (HUD) and U.S. Department of Veterans
Affairs (VA) (Agencies). The purpose of this MOU is to set forth the
procedures which will be utilized by the Agencies in reviewing the
applications for Alaska Native and American Indian Tribes (Tribes)
wishing to participate in loan programs sponsored by the Agencies, when
such Tribal approval is required by the Agencies.

The Agencies sponsor the following loan programs for Tribes:

> **USDA:** Section 502 Direct and Guaranteed Loan Programs sponsored by

the Rural Housing Service (RHS)

> **HUD:** Section 184 Indian Loan Guarantee Program sponsored by the

Office of Native American Programs (ONAP)

Section 248 Indian Reservation Mortgage Insurance sponsored by

the Federal Housing Administration (FHA)

> **VA:** Chapter 38 Direct or Guaranty Programs sponsored by the Loan
>
> Guaranty Service of the Veterans Benefits Administration (VBA)

While the statutory and regulatory provisions authorizing the above loan
programs vary in their specific requirements, each Agency is required to
conduct a review and approval process before a Tribe or its members are
eligible to participate in these loan programs. In August 1998,
President William Clinton directed the Agencies to work together to
streamline mortgage lending in Indian country. In response to that
request, staff from USDA, HUD and VA worked together and developed a
streamlined approval process for Tribes.

Therefore, these Agencies agree to the following procedures:

1\. Any federally recognized American Indian or Alaska Native Tribe
seeking to participate in any or all of the loan programs noted above
may submit the required documentation noted below to any one of the
Agencies.

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RD Instruction 2000-NNN

Exhibit A

Page 2

2\. If the applicant Tribe has adopted and submits the Model Tribal
Lending Procedures for Lien Priority, Eviction and Foreclosure and
Leasing (Attachment 1) and the Model Lease (Attachment 2), (the Model
Documents), its application may be reviewed under this streamlined
approval process (paragraph 3 below). If the Tribe has chosen to
establish Tribal Lending Procedures for Lien Priority, Eviction and
Foreclosure and Leasing or a Lease which varies in content from the
Model Documents, then the reviewing agency will not follow the
streamlined procedures, but rather will proceed as noted in 4 below.

3\. Under the streamlined approval process, if the reviewing Agency
finds that the Tribe has adopted the Model Documents, the Agency and the
Tribe will execute the Tribal Memorandum of Understanding (Attachment
3). The Agency will provide the Tribe with a copy of the MOU containing
both signatures.

> A copy of the Tribe's Lending Procedures, Lease and executed Tribal
> Memorandum of Understanding will then be forwarded to the other
> Agencies. For purposes of this MOU, these documents will be mailed to
> the following addresses:
>
> US Department of Housing and Urban Development

Office of Native American Programs

Office of Loan Guarantee

1999 Broadway Suite 3390 Box 90

Denver, CO 80127

US Department of Housing and Urban Development

FHA, Office of Single Family Housing

451 Seventh St., SW

Room 9266

Washington, DC 20410

US Department of Agriculture

Rural Housing Service

Stop 0701

1400 Independence Ave., SW

Washington, DC 20250

US Department of Veterans Affairs

Loan Guaranty Service

810 Vermont Ave., NW

Washington, DC 20420

4\. A Tribe which chooses to adopt Lending Procedures or a Lease which
differs from the Model Documents will be not be eligible for the
streamlined approval process. The Agency receiving the Tribe's documents
will forward copies of all documents to the other Agencies with a note
that each Agency is responsible for reviewing the documents and making
its own determination for acceptability. The initial Agency will also
inform the Tribe that it has forwarded the documentation to the above
addresses.

RD Instruction 2000-NNN

Exhibit A

Page 3

Under this process, the Tribal Memorandum of Understanding (Attachment
3) will [not]{.underline} be signed by any of the Agencies. Rather, each
Agency will provide the Tribe with its own memorandum of understanding
or other form of approval or disapproval notification.

5\. HUD's ONAP will maintain the listing of approved Tribes on the
website, www.codetalk.fed.us*.* Under either approval method, the Tribe
will be added to the www.codetalk.fed.us website. In cases where one or
two Agencies grant approval, the Tribe's name will be listed with a
notation that the approval is only for certain loan programs.

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Administrator, Rural Housing Service (USDA) Date

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Deputy Assistant Secretary, Native American Date

Programs (HUD)

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Deputy Assistant Secretary, Office of Single Date

Family Housing (HUD)

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Director, Loan Guaranty Service (VA) Date

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RD Instruction 2000-NNN

Exhibit A

Attachment 1

Page 1

MODEL TRIBAL LENDING PROCEDURES FOR:

LIEN PRIORITY, EVICTION AND FORECLOSURE

AND LEASING

**I. OVERVIEW**

> This document highlights roles and responsibilities of the Indian
> tribe for the participation in mortgage loan guarantee and insurance
> programs sponsored by the U. S. Department of Housing and Urban
> Development (HUD), U. S. Department of Agriculture's Rural Housing
> Service (RHS) and U. S. Department of Veterans Affairs (VA). The
> Federal Agencies noted have prepared this document as a guide to
> aid~~e~~ Indian tribes in obtaining the approval of the Agencies for
> participation in each of their programs.
>
> **a. General.** Due to the unique legal status of Indian trust land
> and restricted land, it has been difficult for Native Americans to
> achieve homeownership utilizing financing provided by private lending
> institutions. In general, trust land means land in which the title is
> held in trust by the United States for the benefit of an Indian or
> Indian tribe, and it is inalienable. Trust lands also include lands to
> which the title is held by an Indian tribe subject to a restriction
> against alienation imposed by the United States. Because of the
> difficulty in obtaining a security interest in individual plots,
> conventional mortgage lending practices have not traditionally
> operated in this forum. This has resulted in a reluctance of financial
> institutions to offer their mortgage loan products where Indian trust
> land is involved. This same reluctance has also applied to restricted
> land where the title is held by an individual Indian or tribe and
> which can only be alienated or encumbered by the owner with the
> approval of the Secretary of the Interior.
>
> **b. Legal and Administrative Framework.** For tribal members to
> participate in the federal government sponsored mortgage loan
> programs, the tribe must demonstrate that a legal and administrative
> framework exists that is sufficient to protect the interests of the
> borrower, the lender, and the federal agency which will guarantee or
> insure the mortgage loan. To establish this legal and

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RD Instruction 2000-NNN

Exhibit A

Attachment 1

Page 2

> administrative framework, tribes must have adopted foreclosure,
> eviction, and priority of lien procedures that will apply to these
> loans whenever the tribal court has legal jurisdiction. The legal and
> administrative framework addresses four key procedures: (1)
> foreclosures, (2) evictions, (3) priority of lien procedures, and (4)
> leasing procedures for tribal trust land. Attachment 1 provides model
> tribal mortgage lending ordinances which may be utilized by a tribe or
> may serve as a guide. Use of this model will be deemed acceptable for
> program compliance by all of the federal agencies noted above. If a
> tribe adopts a legal and administrative framework which differs from
> these model documents, it will be necessary for the tribe to seek
> approval, in a separate process, from each of the Federal agencies
> noted.
>
> **c. Tribal Commitment to Enforcement.** A tribe with tribal court
> jurisdiction must also demonstrate its support of one (or more) of
> these programs by notifying at least one of these federal agencies,
> that the tribe has enacted the required legal procedures and that it
> will enforce these procedures. (See Paragraph II.a. below.)

# II. FORECLOSURE AND EVICTION PROCEDURES 

> Foreclosures and evictions will be processed through the legal system
> having jurisdiction over the mortgage loans. This may include federal,
> state, local, or tribal courts.
>
> **a.** **Enactment of Tribal Procedures.** A tribe may enact
> foreclosure and eviction procedures via tribal council resolution or
> any other recognized legislative action. To be considered valid, these
> procedures must be legally enforceable.
>
> **b. Required Provisions.** To preserve tribal autonomy in the
> governing process, the federal agencies noted above will not prescribe
> a format or specific wording for foreclosure and eviction procedures.
> However, all foreclosure procedures must enable the lender and/or the
> Federal agency which has made, insured or guaranteed the mortgage
> loan, to take possession of the property in the event that three or
> more complete

RD Instruction 2000-NNN

Exhibit A

Attachment 1

Page 3

> monthly mortgage installments are due and unpaid, or the Borrower has
> failed to perform any obligation under the Mortgage. All eviction
> procedures must allow for expedited removal of the delinquent
> household residents from occupancy.
>
> **c**. **Sample Documents.** A tribe that does not currently have
> foreclosure and eviction procedures may utilize the model language
> which is attached, or may contact other tribes to obtain procedural
> options.
>
> **d.** **Failure to Enforce.** Each of the Federal Agencies noted
> above has different authority to take action in the case of a Tribe
> which does not enforce its established eviction and foreclosure
> requirements. For information on the action to be taken, contact the
> appropriate Federal Agency directly.

**III.** **LIEN PROCEDURES**

> Mortgages guaranteed under the following programs must have a first
> lien position on the property. Those programs are: HUD Section 184,
> HUD Section 248, and USDA Section 502 Guaranteed. Under the USDA
> Section 502 Direct program, the loan may be subordinated under certain
> circumstances (contact the USDA's Rural Housing representative for
> further information.) enforcement will be processed through the
> appropriate federal, state, local or tribal system. The lender
> responsibility is only to verify that the Tribe has adopted the model
> procedures and is approved by the Federal Agency guaranteeing or
> insuring the mortgage.
>
> **a.** **Enactment of Tribal Lien Procedures.** To ensure that each
> direct, guaranteed or insured mortgage holds a first lien position,
> each tribal government must enact a law that provides either:
>
> **(1)** For the satisfaction of HUD , VA, or USDA direct, guaranteed
> or insured mortgages before other obligations (except tribal leasehold
> taxes assessed after the property is mortgaged); or

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RD Instruction 2000-NNN

Exhibit A

Attachment 1

Page 4

> **(2)** That state law shall determine the priority of liens against
> the property. If a reservation spans two or more states, the state in
> which the property is located is the applicable state law.
>
> **b.** **Format.** The federal agencies noted above will not prescribe
> a specific format for adopting lien requirements.
>
> **c.** **Failure to Enforce.** If any of the Federal Agencies issuing
> loans, guarantees or insurance within the jurisdiction of an approved
> tribe~~s~~ determines that the tribe does not enforce adopted lien
> enforcement or eviction procedures, that Agency will notify the other
> Federal Agencies of such non-enforcement. Each Federal Agency will
> take appropriate action in accordance with paragraph II.d., above.
>
> **d.** **Recordation.** On tribal trust or other federally restricted
> land, liens shall be recorded by filing with the Land Titles and
> Records Office at the BIA and may also be recorded with the tribe in
> accordance with local ordinances/resolutions if appropriate. Section
> 248 requires recording with the State (if available). On fee simple
> land, liens shall be filed with the State or County recording system
> having jurisdiction over the property.

**IV.** **LEASING TRIBAL TRUST LAND**

> To receive a loan guarantee/insurance on tribal trust lands, the
> borrower must establish a leasehold interest in the land on which the
> home will be located.
>
> **a.** **Leasehold Documents.** Appendix 2 provides a standard lease
> form that has been approved by the BIA, HUD, USDA and VA for use on
> tribal trust land. This sample lease form contains certain provisions
> that are required to be included in leases for trust and restricted
> land used as collateral for the loan programs administered by these
> agencies.

RD Instruction 2000-NNN

Exhibit A

Attachment 1

Page 5

> **b.** **Lease Modifications.** The standard lease form may be
> modified by the mutual consent of the tribe and the borrower.
> Modifications to the standard lease form are made by rider and require
> the approval of BIA and the federal agency which is proposed to make,
> guarantee, or insure the loan. No lease modification may serve to
> obstruct the right of any of the Federal Agencies or the lender to
> evict the borrower or foreclose on or sell the property in the event
> of default.
>
> **c.** **Parties to the Lease.** The lease must be executed by the
> tribe (Lessor) and borrower (Lessee) and approved by the Secretary of
> the Interior prior to issuance of a firm commitment/lender approval.
>
> **d.** **Leasehold Payments.** The amount of the lease rental is
> negotiable between the Indian tribe (Lessor) and borrower (Lessee)
> subject to the approval of the Secretary of the Interior.
>
> **(1)** The lease rental and provisions for increases in the rent
>
> will be a consideration of the lender in determining the mortgage
> amount for which the borrower qualifies.
>
> **(2)** The tribe must notify the lender of lease rental payments
> and/or taxes. Except for mortgages insured under 248, the lender may
> require that the lease payments be made through the lender, as is
> typically done with local property taxes. If the tribe wishes, tribal
> tax liens resulting from that portion of the unpaid leasehold payments
> applicable to tribal taxes may be recorded in the state recording
> system. The tribe may also intervene in any foreclosure proceeding to
> ask that the taxes be paid.
>
> **e.** **Lease Transfers and Assignments.** The tribe must approve all
> transfers or assignments of the leasehold interest, except at
> foreclosure and as otherwise provided in the lease.

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RD Instruction 2000-NNN

Exhibit A

Attachment 1

Page 6

> **f.** **Lease Status at Foreclosure.** The Federal Agency which made,
> insured or guaranteed the mortgage loan, or the lender may assume
> title to the leasehold interest without tribal approval of such
> transfer. However, anyone who subsequently purchases or rents the
> leasehold property must be approved by the tribe except as otherwise
> provided in the lease.
>
> **g. Termination.** The lease may not be terminated while the
>
> federal loan, guarantee or insurance is in effect without the approval
> of the applicable Federal Agency**.** Likewise, in the event of
> foreclosure, the lease will not be subject to any forfeiture or
> reversion and will not be otherwise subject to termination.

**V.** **MORTGAGING ALLOTTED TRUST LANDS**

> **a.** **General.** Unless otherwise approved by the applicable
> Federal Agency, owners of undivided interests cannot mortgage trust
> property.
>
> **b.** **Mortgages on Allotted Trust Land.** The allottee or owner of
> the individual trust may choose to mortgage the land and consequently
> risk permanent loss of the land in the case of default and subsequent
> foreclosure. Allottees or owners of an individual trust are permitted
> to mortgage properties with the approval of BIA. If foreclosure occurs
> on mortgaged allotted trust land, the title to the land is removed
> from trust status. In general, Deeds of Trust must be approved by the
> BIA, and should include a 483b rider. The HUD Section 248 program is
> not available on allotted trust lands.
>
> **c. Fractionated Ownership.** It is common for allotted trust lands
> to be owned by several individuals. If a prospective borrower proposes
> to use trust or restricted land in which he or she owns an interest,
> he or she must acquire a lease from all of the co-owners (this action
> may require the individual to pay a rental to the co-owners) and
> approval of the lease by the Secretary of the Interior.

RD Instruction 2000-NNN

Exhibit A

Attachment 1

Page 7

**VI.** **TRIBAL APPLICATION AND APPROVAL**

> Before a lender may process a mortgage loan application where a
> guarantee/insurance is proposed under a program sponsored by either
> HUD, USDA or VA, or a Federal Agency may process a direct loan
> application, a tribe with tribal court jurisdiction over that property
> must provide the applicable Federal Agency with a copy of its
> foreclosure, eviction and priority of lien ordinances and its lease.
> If an Agency approves the tribe's ordinances and lease, it will
> execute a Memorandum of Understanding (MOU) with the tribe (Attachment
> 3). A copy of this MOU will be furnished to the other agencies. If a
> tribe's documents do not follow the basic intent and requirements of
> the model documents which are attached to this guide, the tribe will
> need to seek approval of HUD, VA and USDA individually, in order to
> participate in each of their mortgage loan programs.
>
> **a.** **Notice Content.** Appendix 4 includes a checklist of those
> items necessary in order to receive Agency approval. To obtain
> approval, the tribe's submission must provide evidence that it:
>
> **(1)** Will ensure that the Federal Agencies and private lenders have
> access to tribal lands for the purpose of servicing and evaluating
> properties securing direct, guaranteed or insured mortgages.
>
> **(2)** Has enacted foreclosure procedures.
>
> **(3)** Has enacted eviction procedures.
>
> **(4)** Understands that if eviction and foreclosure procedures are
> not enforced, all of the Departments noted may cease making,
> guaranteeing or insuring new loans within their area of jurisdiction
> pursuant to paragraph II.d.

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RD Instruction 2000-NNN

Exhibit A

Attachment 1

Page 8

> **(5)** Has adopted procedures giving the Federal Agency first lien
> priority (where applicable) or otherwise ensuring that the direct,
> guaranteed, or insured loan will be satisfied before all other
> property debts (excepting tribal taxes); [or]{.underline} has adopted
> legislation stating that it will abide by applicable state or local
> laws with respect to lien priority.
>
> **b.** **Notification Process:**
>
> **(1)** Tribe sends to either HUD, USDA or VA, the items noted in the
> checklist at Appendix 4.
>
> **(2)** It is not necessary for a tribe to obtain approval from the
> applicable Federal Agency for each new direct, guaranteed or insured
> loan once a tribe has executed a Memorandum of Understanding (MOU)
> with that Federal Agency. Any Federal Agency initially approving a
> tribe will provide copies of the executed MOU to the other Federal
> Agencies. The tribe\'s executed MOU will be kept on file by each of
> the Agencies.
>
> **(3)** Upon receipt of a borrower application, lenders may call the
> appropriate Federal Agency to determine whether a given tribe is ready
> to participate in the loan program(s). The lender may also ask the
> borrower to submit a land status form which will provide the lender
> and Department with confirmation of the land status (tribal trust,
> allotted trust or fee simple within the tribe's jurisdiction).

RD Instruction 2000-NNN

Exhibit A

Attachment 1

Page 9

> **Attachment 1**

**Model Tribal Mortgage Lending Code**

> *Commentary: This Attachment sets forth general procedures for
> mortgages and foreclosures. It is designed to meet the needs of
> mortgage loan guarantee, insurance and direct loan programs sponsored
> by the U. S. Departments of Housing and Urban Development, Agriculture
> (Rural Housing) and Veterans Affairs. These Federal Agencies offer
> various mortgage loan programs which are designed to provide
> homeownership opportunities to Native Americans wishing to live on an
> Indian reservation or within an Indian area (as defined within each
> Agency's program requirements).*

A. [Lien Priority]{.underline}

> All mortgage loans recorded in accordance with the recording
> procedures set forth in this Attachment, including Leasehold
> Mortgages, and including loans made, guaranteed, insured or held by a
> governmental agency, shall have priority over any lien not perfected
> at the time of such recording and any subsequent lien or claim
> excepting a lien or claim arising from a tribal leasehold tax assessed
> after the recording of the mortgage. (In those cases where the
> government direct, guaranteed or insured mortgage is created as a
> second mortgage, the loan shall assume that position.)

B. [Recording of Mortgage Loan Documents]{.underline}

> \(1\) The Tribal Recording Clerk shall maintain in the Tribal Real
> Estate program a system for the recording of mortgage loans and such
> other documents as the Tribe may designate by laws or resolution.
>
> \(2\) The Tribal Recording Clerk shall endorse upon any mortgage loan
> or other document received for recording:
>
> \(a\) The date and time of receipt of the mortgage or other document;
>
> \(b\) The filing number, to be assigned by the Tribal Recording Clerk,
> which shall be a unique number for each mortgage or other document
> received and;
>
> \(c\) The name of the Tribal Recording Clerk or designee receiving the
> mortgage or document.

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RD Instruction 2000-NNN

Exhibit A

Attachment 1

Page 10

> Upon completion of the above-cited endorsements, the Tribal Recording
> Clerk shall make a true and correct copy of the mortgage or other
> document and shall certify the copy as follows:
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ Tribe )
>
> )ss.
>
> Indian Reservation )
>
> I certify that this is a true and correct copy of a document received
> for recording this date.
>
> Given under my hand and seal this \_\_\_\_\_\_ day of
> \_\_\_\_\_\_\_\_\_\_\_\_.
>
> (SEAL)
>
> (Signature)
>
> (Date)
>
> The Tribal Recording clerk shall maintain the copy in the records of
> the recording system and shall return the original of the mortgage
> loan or other document to the person or entity that presented the same
> for recording.
>
> \(3\) The Tribal Recording Clerk shall also maintain a log of each
> mortgage loan or other document recorded in which there shall be
> entered:
>
> \(a\) The name(s) of the Borrower/Mortgagor of each mortgage loan,
> identified as such;
>
> \(b\) The name(s) of the Lender/Mortgagee of each mortgage loan,
> identified as such;
>
> \(c\) The name(s) of the grantor(s), grantee(s) or other designation
> of each party named in any other documents filed or recorded;

\(d\) The date and time of the receipt;

\(e\) The filing number assigned by the Tribal Recording Clerk; and

> \(f\) The name of the Tribal Recording Clerk or designee receiving the
> mortgage or document.

\(4\) The certified copies of the mortgage loan and other documents and
the log maintained by the Tribal Recording Clerk shall be made available
for public inspection and copying. Rules for copying shall be
established and disseminated by the Tribal Recording Clerk.

\(5\) All mortgages will be recorded with the BIA in addition to any
Tribal recording provisions.

RD Instruction 2000-NNN

Exhibit A

Attachment 1

Page 11

> *Commentary: The federal agencies noted above recognize that Indian
> tribes are required to have mortgages filed with the Bureau of Indian
> Affairs (BIA). It is optional whether or not the tribe houses its
> Recording department within a "Tribal Real Estate" program. The tribe
> is free to place the Recording function in any tribal department it
> wishes.*

\(c\) [Foreclosure Procedures]{.underline}

\(1\) A Borrower/Mortgagor shall be considered to be in default when he
or she is thirty (30) days past due on his or her mortgage payment(s)or
is in violation of any covenant under the mortgage for more than 30 days
to the Lender/Mortgagee (i.e. the 31st day from the payment due date).

> \(2\) When a Borrower/Mortgagor is thirty days past due on his or her
> mortgage and before any foreclosure action or activity is initiated,
> the Lender/Mortgagee shall complete the following:
>
> \(a\) Make a reasonable effort to arrange a face-to-face interview
> with the Borrower/Mortgagor. This shall include at least one trip to
> meet with the Borrower/Mortgagor at the mortgaged property.
>
> \(b\) Lender/Mortgagee shall document that it has made at least one
> phone call to the Borrower/Mortgagor (or the nearest phone as designed
> by the Borrower/Mortgagor, able to receive and relay messages to the
> Borrower/Mortgagor) for the purpose of trying to arrange a
> face-to-face interview.
>
> \(3\) Lender/Mortgagee may appoint an agent to perform the services of
> arranging and conducting the face-to-face interview specified in this
> action.
>
> \(4\) When the Borrower/Mortgagor is past due on three installment
> payments and at least ten (10) days before initiating a foreclosure
> action in Tribal Court, the Lender shall advise the Borrower/Mortgagor
> in writing by mail or by posting prominently on the unit, with a copy
> provided to the Tribe, as follows:
>
> \(a\) Advise the Borrower/Mortgagor that information regarding the
> loan and default**/**delinquency will be given to credit bureaus.
>
> \(b\) Advise the Borrower/Mortgagor of homeownership counseling
> opportunities/programs available through the Lender or otherwise.
>
> \(c\) Advise the Borrower/Mortgagor of other available assistance
> regarding the mortgage/default.

(06-26-02) PN 347

RD Instruction 2000-NNN

Exhibit A

Attachment 1

Page 12

> \(d\) In addition to the preceding notification requirements, the
> Lender/Mortgagee shall complete the following additional notice
> requirements (i) notify the Borrower/Mortgagor that if the Leasehold
> Mortgage remains past due on three installment payments, the
> Lender/Mortgagee may ask the applicable governmental agency to accept
> assignment of the Leasehold Mortgage if this is an option of the
> governmental program; (ii) notify the Borrower/Mortgagor of the
> qualifications for forbearance relief from the Lender/Mortgagee, if
> any, and that forbearance relief may be available from the government;
> and (iii) provide the Borrower/Mortgagor with names and addresses of
> government officials to whom further communications may be addressed,
> if any.
>
> \(5\) If a Borrower/Mortgagor is past due on three or more installment
> payments and the Lender/Mortgagee has complied with the procedures set
> forth in the first part of this Section, the Lender/Mortgagee may
> commence a foreclosure proceeding in the Tribal Court by filing a
> verified complaint as set forth in Section D. of this Code.
>
> *Commentary: The proceeding Section C sets forth foreclosure
> procedures designed to meet all of the foreclosure procedure
> requirements currently established under the mortgage loan programs
> sponsored by the U.S. Departments of Housing and Urban Development,
> Agriculture and Veterans Affairs (collectively referred to as Federal
> Agency). However, under HUD's Section 248 mortgage insurance program,
> lenders have the option of assigning the mortgage to HUD rather than
> initiating foreclosure. If the lender exercises its option to assign
> the mortgage to HUD, it must comply with the requirements of the
> regulations at 24 CFR part 203.*

D. [Foreclosure Complaint and Summons]{.underline}

\(1\) The verified complaint in a mortgage foreclosure proceeding shall
contain the following:

> \(a\) The name of the Borrower/Mortgagor and each person or entity
> claiming through the Borrower/Mortgagor subsequent to the recording of
> the mortgage loan, including each Subordinate Lienholder (except the
> Tribe with respect to a claim for a tribal leasehold), as a defendant;
>
> \(b\) A description of the property subject to the mortgage loan;
>
> \(c\) A concise statement of the facts concerning the execution of the
> mortgage loan and in the case of a Leasehold Mortgage the lease; the
> facts concerning the recording of the mortgage loan or the Leasehold
> Mortgage; the facts concerning the alleged default(s) of the
> Borrowers/Mortgagor; and such other facts as may be necessary to
> constitute a cause of action;

RD Instruction 2000-NNN

Exhibit A

Attachment 1

Page 13

> \(d\) True and correct copies of each promissory note, mortgage, deed
> of trust or other recorded real property security instrument (each a
> "security instrument") and any other documents relating to the
> property and if a Leasehold Mortgage, a copy of the lease and any
> assignment of any of these documents; and
>
> \(e\) Any applicable allegations concerning relevant requirements and
> conditions prescribed in (i) federal statutes and regulations (ii)
> tribal codes, ordinances and regulations; and/or (iii) provisions of
> the promissory note, security instrument and if a Leasehold Mortgage,
> the lease.
>
> \(2\) The complaint shall be verified by the Tribal Court Clerk along
> with a summons specifying a date and time of appearance for the
> Defendant(s).

E. [Service of Process and Procedures]{.underline}. Any foreclosure
complaint must be in writing, and must be delivered to the
Borrower/Mortgagor in the following manner:

> \(1\) Delivery must be made by an adult person and is effective when
> it is:

\(a\) Personally delivered to a Borrower/Mortgagor with a copy sent by
mail, or

> \(b\) Personally delivered to an adult living in the property with a
> copy sent by mail, or
>
> \(c\) Personally delivered to an adult agent or employee of the
> Borrower/Mortgagor with a copy sent by mail.
>
> \(2\) If the notice cannot be given by means of personal delivery, or
> the Borrower/Mortgagor cannot be found, the notice may be delivered by
> means of:
>
> \(a\) Certified mail, return receipt requested, at the last known
> address of the Borrower/Mortgagor, or
>
> \(b\) Securely taping a copy of the notice to the main entry door of
> the property in such a manner that it is not likely to blow away, and
> by posting a copy of the notice in some public place near the
> premises, including a tribal office, public store, or other
> commonly-frequented place and by sending a copy first class mail,
> postage prepaid, addressed to the Borrower/Mortgagor at the premises.
>
> \(3\) The person giving notice must keep a copy of the notice and
> proof of service in accordance with this section, by affidavit or
> other manner recognized by law.

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RD Instruction 2000-NNN

Exhibit A

Attachment 1

Page 14

F. [Cure of Default]{.underline}

> Prior to the entry of a judgment of foreclosure, any
> Borrower/Mortgagor or a Subordinate Lienholder may cure the default(s)
> under the Mortgage by making a full payment of the delinquency to the
> Lender/Mortgagee and all reasonable legal and Court costs incurred in
> foreclosing on the property. Any subordinate Lienholder who has cured
> a default shall thereafter have included in its lien the amount of all
> payments made by such Subordinate Lienholder to cure the default(s),
> plus interest on such amounts at the rate stated in the note for the
> mortgage. There shall be no right of redemption in any Leasehold
> Mortgage Foreclosure proceeding.
>
> *Commentary: This Section F. does not allow for a "right of
> redemption." The "right of redemption" if provided in a Foreclosure
> Code allows a Borrower/Mortgagor to redeem (purchase) his/her
> foreclosed property after it has been sold at a foreclosure sale. Most
> state foreclosure laws have very strict time limits on how long a
> Borrower/Mortgagor has to redeem his/her property after a foreclosure
> sale, when the right to redeem will be allowed, and notice
> requirements that must be given the Borrower/Mortgagor following the
> sale of his/her foreclosed property. Because the right of redemption
> can be very specialized the drafters of this model Code will leave to
> the discretion of the tribe whether or not to incorporate a "right of
> redemption" and under what terms. If a "right of redemption" is
> included, it will be necessary for the tribe to seek approval in a
> separate process from each of the Federal Agencies noted.*

G. [Judgment and Remedy]{.underline}

> This matter shall be heard and decided by the Tribal Court in a prompt
> and reasonable time period not to exceed sixty (60) days from the date
> of service of the Complaint on the Borrower/Mortgagor. If the alleged
> default has not been cured at the time of trial and the Tribal Court
> finds for the Lender/Mortgagee, the Tribal Court shall enter judgment:
>
> \(1\) Foreclosing the interest of the Borrower/Mortgagor and each
> other defendant, including Subordinate Lienholder, in the mortgaged
> property and
>
> \(2\) Granting title to the property to the Lender/Mortgagee or the
> Lender's Designated Assignee; in the case of a Leasehold Mortgage, the
> Lease and the Leasehold Estate will be assigned to the
> Lender/Mortgagee or the Lender's Designated Assignee, subject to the
> following provisions

RD Instruction 2000-NNN

Exhibit A

Attachment 1

Page 15

> \(a\) The lender shall give the Tribe the right of first refusal on
> any acceptable offer to purchase the Lease and the Lessee's leasehold
> interest in the property described in the lease which is subsequently
> obtained by the Lender or Lender's Designated Assignee.
>
> \(b\) The Lender or Lender's Designated Assignee may only transfer,
> sell or assign the Lease and Lessee's leasehold interest in the
> property described in the Lease to a Tribal member, the Tribe, or the
> Tribal Housing Authority;
>
> \(c\) The mortgagee has the right to convey the leasehold interest to
> the Secretary of HUD without providing the right of first refusal to
> the Tribe for Section 248.

H. [Foreclosure Evictions]{.underline}

> Foreclosure evictions shall be handled according to the general
> eviction process set forth below.
>
> \(1\) [Jurisdiction]{.underline}. The provisions of this section H.
> shall apply to all persons and property subject to the governing
> authority of the Tribe as established by the Tribal Constitution,
> Tribal Code, or applicable federal law.
>
> \(2\) [Unlawful Detainer]{.underline}. A Lessee, Sublessee, or other
> occupant of a Leasehold Estate subject to a Leasehold Mortgage shall
> be guilty of unlawful detainer if such person shall continue in
> occupancy of such Leasehold Estate without the requirement of any
> notice by the Lessor, after such person's Leasehold Estate has been
> foreclosed in a Leasehold Mortgage foreclosure proceeding in the
> Tribal Court;
>
> \(3\) [Complaint and Summons.]{.underline} The lender or Federal
> Agency (which made, guaranteed or insured the mortgage loan) as
> appropriate, shall commence an action for unlawful detainer by filing
> with the Tribal Court, in writing, the following documents:
>
> \(a\) A complaint, signed by the lender or Federal Agency, or an agent
> or attorney on their behalf:

\(i\) Citing facts alleging jurisdiction of the Tribal Court;

> \(ii\) Naming as defendants the mortgagors and any other record owner
> (including Sublessees and subordinate lienholders), of which the
> complainant has record notice (except the Tribe with respect to a
> claim for a Tribal tax on the Leasehold Estate subject to the
> Leasehold Mortgage);
>
> \(iii\) Describing the Leasehold Estate subject to the Leasehold
> Mortgage;

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RD Instruction 2000-NNN

Exhibit A

Attachment 1

Page 16

> \(iv\) Stating the facts concerning (1) the execution of the lease and
> the Leasehold Mortgage; (2) the recording of the Leasehold Mortgage;
> and (3) the facts upon which he or she seeks to recover;
>
> \(v\) Stating any claim for damages or compensation due from the
> persons to be evicted; and
>
> \(vi\) Otherwise satisfying the requirements of the Tribal Court.
>
> \(b\) A copy of the summons, issued in accordance with established
> Tribal Court rules and procedures, requiring the defendants to file a
> response to the complaint by the date specified in the summons. The
> deadline specified in the summons for filing a response shall be no
> less than 6 nor more than 30 days from the date of service of the
> summons and complaint. The summons shall notify the defendants that
> judgment will be taken against them in accordance with the terms of
> the complaint unless they file a response with the court by the date
> specified in the summons.
>
> \(4\) [Service of Summons and Complaint]{.underline}. A copy of the
> summons and complaint shall be served upon the defendants in the
> manner provided by the Tribal Court rules for service of process in
> civil matters. In the absence of such Tribal Court rules, the summons
> and complaint shall be served by one of the following two methods.
>
> \(5\) [Procedures for Service of Notice]{.underline}. Notices required
> or authorized in the immediately preceding section shall be given in
> writing either by:
>
> \(a\) delivering a copy personally to the Borrower/ Mortgagor or to
> any other occupant under color of law, or to any adult residing on the
> Leasehold Estate and, if applicable, to any Sublessee; or
>
> \(b\) posting said notice in a conspicuous place near the entrance to
> said Leasehold Estate, and sending an additional copy to the Lessee or
> to any other occupant under color of law, and, if applicable, to the
> Sublessee, by certified mail, return receipt requested, properly
> addressed, postage paid.

Proof of service may be made by affidavit of any adult person stating
the he has complied with the requirements of one of the above methods of
service.

> \(6\) [Power of the Tribal Court]{.underline}. The Tribal Court shall
> enter an Order of Repossession if:
>
> \(a\) Notice of suit is given by service of summons and complaint in
> accordance with the procedures provided herein; and

RD Instruction 2000-NNN

Exhibit A

Attachment 1

Page 17

> \(b\) The Tribal Court shall find during pre-trial proceedings or at
> trial that the Lessee, Sublessee, or other occupant under color of law
> of the Leasehold Estate subject to the Leasehold Mortgage is guilty of
> an act of unlawful detainer.
>
> Upon issuance of an Order of Repossession, the Tribal Court shall have
> the authority to enter a judgment against the defendants for the
> following, as appropriate: (1) back rent, unpaid utilities, and any
> charges due the Tribe, Tribal Housing Authority, other public Housing
> Authority, or Sublessor under any sublease or other written agreement
> (except for a Leasehold Mortgage); (2) any and all amounts secured by
> the Leasehold Mortgage that are due the lender (or Federal Agency);
> and (3) damages to the property caused by the defendants, other than
> ordinary wear and tear. The Tribal Court shall have the authority to
> award to the prevailing party its costs and reasonable attorney's fees
> in bringing suit.
>
> \(7\) [Enforcement]{.underline}. Upon issuance of an Order of
> Repossession by the Tribal Court, Tribal law enforcement officers
> shall help plaintiffs enforce same by evicting the defendants and
> their property from the unlawfully occupied Leasehold Estate. In all
> cases involving the lender or Federal Agency, the Order of
> Repossession shall be enforced no later than 45 days after a pre-trial
> proceeding or trial in which the Tribal Court finds against
> defendants, subject to Paragraph H7 below, and provided, that no party
> exercised the right to cure a default or right of first refusal as
> described in Paragraphs F and G above.
>
> \(8\) [Continuances in Cases Involving the Lender or Federal
> Agency]{.underline}.(which originally made, insured or guaranteed) the
> mortgage loan. Except by agreement of all parties, there shall be no
> continuances in cases involving the lender or Federal Agency that will
> interfere with the requirement that the Order of Repossession be
> enforced not later than 45 days after a pre-trial proceeding or trial
> in which the Tribal Court finds against defendants, subject to the
> sound discretion of the Court.

I.  [No Merger of Estates]{.underline}.

> There shall be no merger of estates by reason of the execution of a
> Lease or a Leasehold Mortgage or the assignment or assumption of the
> same, including an assignment adjudged by the Tribal Court, or by
> operation of law, except as such merger may arise upon satisfaction of
> the Leasehold Mortgage.

(06-26-02) PN 347

RD Instruction 2000-NNN

Exhibit A

Attachment 1

Page 18

J. [Certified Mailing to Tribe]{.underline}

> In any foreclosure proceedings on a Leasehold Mortgage where the Tribe
> is not named as a defendant, a copy of the summons and complaint shall
> be mailed to the Tribe by certified mail, return receipt requested,
> within five (5) days after the issuance of the summons. If the lessor
> is not the tribe, this notice will also be mailed to the lessor at the
> same time the notice is mailed to the tribe. If the location of the
> lessor cannot be ascertained after reasonable inquiry, a copy of the
> summons and complaint shall be mailed to the lessor in care of the
> Superintendent of the applicable agency of the Bureau of Indian
> Affairs.

K. [Intervention]{.underline}

> The Tribe or any Lessor may petition the Tribal Court to intervene in
> any Lease or Leasehold Mortgage foreclosure proceeding under this
> Code. Neither the filing of a petition for intervention by the Tribe,
> nor the granting of such petition by the Tribal Court shall operate as
> a waiver of the sovereign immunity of the Tribe, except as may be
> expressly authorized by the Tribe.

L.  [Appeals]{.underline}

> Appeals under this Code shall be handled in accordance with the
> general tribal appellate provisions.

CERTIFICATION

The foregoing [\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline} (name of
Tribe) Leasehold Mortgaging Code was enacted by the Tribal Council of
the [\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline}Tribe on the
[\_\_\_\_]{.underline} day of

[\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline}, 2000, by a vote of
[\_\_\_\_]{.underline} for, [\_\_\_]{.underline} opposed, and
[\_\_\_\_]{.underline} abstaining, at a dully called meeting at which a
quorum of the Tribal Council was present.

.

Tribal President

ATTEST:

**[\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline}**

Tribal Secretary

RD Instruction 2000-NNN

Exhibit A

Attachment 1

Page 19

CERTIFICATION

\_\_\_\_\_\_\_\_\_\_Tribe )

) ss.

)

I certify that this is a true and correct copy of a document received
for

recording this date. Given under my hand and seal this \_\_\_\_ day of
\_\_\_\_\_\_\_\_\_\_\_\_\_\_.

(SEAL)

Signature

Title

## oOo

(06-26-02) PN 347

RD Instruction 2000-NNN

Exhibit A

Attachment 2

Page 1

RESIDENTIAL LEASE OF TRIBAL OWNED LAND

Lease No.\_ [\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline}.

Contract No. \_[\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline}.

THIS Lease is made and entered into by and between
[\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline} for and on behalf of
[\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline} Tribe of Indians,
hereinafter designated as \"Lessor,\" and
[\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline},
members of the [\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline} Tribe
and residing upon the [\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline}
Indian Reservation, hereinafter designated as \"Lessee.\"

WITNESSETH

1\. SECRETARIAL APPROVAL; FEDERAL AGENCY APPROVAL; DEFINITIONS OF
FEDERAL AGENCY, TRIBE, and LENDER. As used in this Lease, the term
\"Secretary\" means the Secretary of the Interior or his or her duly
authorized representative. This Lease is subject to the approval of the
Secretary pursuant to the Act of August 9, 1955, 69 Stat. 539, as
amended, 25 U.S.C.\
§ 415, as implemented by Title 25, Code of Federal Regulations, Part
162. The form of this Lease has been accepted by the Secretary of
Housing and Urban Development (HUD) pursuant to 24 C.F.R. § 203.43h(c),
which implements Section 248 of the National Housing Act, 12 U.S.C. §
1715z-13, for use in connection with Federal Housing Administration
(FHA) insurance of a mortgage on the interest created by this Lease, and
pursuant to 24 C.F.R. § 1005.107, which implements Section 184 of the
Housing and Community Development Act of 1992 (Pub. L.102-550) for use
in connection with HUD\'s issuance of a loan guarantee of a mortgage on
the interest created by this Lease. The form of this Lease has also been
accepted by the Secretary of the United States Department of Agriculture
(USDA) for use in connection with the issuance by USDA or its Rural
Housing Service (RHS) of a direct or guaranteed loan pursuant to section
502 of the Housing Act of 1949 as amended, 42 U.S.C. § 1472, and
accepted by the Secretary of the Veterans Affairs (VA) for use in
connection with the issuance by VA of a direct or guaranteed loan
pursuant to chapter 37 of Title 38, United States Code, secured by the
interest created by this Lease. As used in the context of this Lease,
the term "Tribe or Tribal" refers to the respective Tribe who enters
into this Lease as the "Lessor". For future reference, "Federal Agency
refers to HUD, VA, and ­­USDA. When used in this Lease, the "lender" is
any mortgagee that a Federal Agency has approved or a Federal Agency
which makes a direct loan. With respect to mortgages which are insured
under Section 248 of the National Housing Act, the lender must be

(06-26-02) PN 347

RD Instruction 2000-NNN

Exhibit A

Attachment 2

Page 2

approved by the Federal Housing Administration. The term "lender" also
includes any of the lender's successors or assigns of the lender's
right, title to, or interest in, the Mortgage and any subsequent
noteholder secured by the Mortgage. The assignment of the mortgage or
any interest therein does not require the consent of the Tribe.

2\. PREMISES. Lessor hereby Leases to the Lessee all that tract or
parcel of land situated on the
[\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline} Indian Reservation,
County of [\_\_\_\_\_\_\_\_\_\_\_]{.underline}, State of
[\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline}, and described
as follows (the Leased Premises):

> \[description\], [\_\_\_\_\_\_\_\_\_\_\_\_]{.underline} County,
> [\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline} Indian Reservation,
> [\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline}, approximately
> [\_\_\_\_\_\_]{.underline} acres.

3\. USE OF PREMISES. The purpose of this Lease is to enable the Lessee
to construct, improve, and maintain a dwelling and related structures on
the Leased Premises, and otherwise to use said premises as a principal
residence. The Lessee agrees not to use any part of the Leased Premises
for any unlawful conduct or purposes and will comply with all applicable
Federal Laws.

4\. TERM. Lessee shall have and hold the Leased Premises for a term of
\_\_\_\_ years beginning on the effective date of this Lease. This Lease
may not be terminated by either or both parties during its term if, and
as long as, the Lease and/or any improvements on the premises, or any
interest therein, is mortgaged or otherwise pledged as security for any
loan in accordance with the provisions hereof, unless consent in writing
to such termination is given by the lender and, if the loan is
guaranteed, insured, or made by a Federal Agency, a written consent of
that agency is also required. This Lease shall not be subject to any
forfeiture or reversion and shall not be otherwise terminable, if such
event would adversely affect any interest in the Leased Premises,
including improvements thereon, acquired in accordance with the
provisions hereof by the holder of any mortgage or other lien, or of any
purchaser at a foreclosure sale under such mortgage (or lien) or under
any conveyance given in lieu of foreclosure, or of any holder subsequent
to such purchase. In the event a Federal Agency acquires a mortgage on
the interest created by this Lease by assignment from a lender, the
Lessor shall not terminate the Lease without the written consent of the
respective Federal Agency, as long as the mortgage is in force.

RD Instruction 2000-NNN

Exhibit A

Attachment 2

Page 3

5\. RENT. The improvement of housing for Tribal families is a public
purpose of the Lessor. The consideration for this Lease is (1) the
obligation of Lessee to further said purpose, (2) the promise hereby
given by Lessee to pay the Lessor rent at the rate of
\$[\_\_\_\_\_\_]{.underline}per [\_\_\_\_\_\_]{.underline}, (3) the
extinguishment, hereby agreed to by Lessee, of any and all use rights
heretofore held by Lessee in the Leased Premises, so that Lessee shall
hereafter hold rights only by virtue of this Lease, and (4) other good
and valuable considerations, the receipt of which is hereby acknowledged
by Lessor. Rent may be subject to adjustment pursuant to 25 CFR 162.

6\. IMPROVEMENTS. All buildings or other improvements now existing or
hereafter constructed on the Leased Premises shall be the leasehold
property of the Lessee during the term of this Lease, including any
extension or renewal thereof. During the term of this Lease, Lessee
shall obtain any necessary governmental permits, approvals or
authorization required for the construction and use of all improvements
he or she (they) places or cause(s) to be placed on the Leased Premises,
and shall comply with all laws applicable to the construction and use of
improvements.

7\. USE RIGHT. Upon expiration of this Lease, or upon its termination in
accordance with the terms hereof, unless such termination is due to
default upon the part of Lessee, Lessee or any successors in interest
shall be entitled to use rights in the Leased Premises if qualified
under the laws of the Tribe. If not so eligible, Lessee, his or her
(their) subLessee and any successors in interest shall, upon demand,
surrender to Lessor upon expiration or other termination of this Lease
complete and peaceable possession of the Leased Premises and all
improvements thereon which have not been relocated as permitted under
Paragraph 23 of this Lease*,* which shall be the property of the Tribe.

8\. FEDERAL SUPERVISION.

> \(a\) Nothing contained in this Lease shall operate to delay or
> prevent a termination of Federal responsibilities with respect to the
> Leased Premises by the issuance of a fee patent, the lifting of
> restrictions on alienation, or otherwise during the term of the Lease;
> such termination, however, shall not serve to abrogate the Lease.
>
> \(b\) No member of Congress or any delegate thereto or any Resident
> Commissioner shall be admitted to any share or part of this Lease or
> to any benefit that may arise herefrom.

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RD Instruction 2000-NNN

Exhibit A

Attachment 2

Page 4

9\. QUIET ENJOYMENT. Lessor agrees to defend the title to the Leased
Premises and also agrees that Lessee and any successors in interest
shall peaceably and quietly hold, enjoy and occupy the Leased Premises
for the duration of this Lease without any hindrance, interruption,
ejection or molestation by Lessor or by any other persons whomsoever,
except if the requirements of any part of this Lease are not kept by the
Lessee. Notwithstanding the foregoing, Lessee and his or her (their)
assigns is (are) subject to all the laws of the Tribe to the same extent
as any other Tribal member or resident.

10\. ASSIGNMENT AND SUBLEASE. (a) Except as otherwise provided herein,
Lessee shall not assign or sublet this Lease without the prior written
consent of the Lessor and sureties (as found in 25 CFR 162 ), and
approval of the Secretary of the Interior. If this Lease and/or any
improvements on the Leased Premises are mortgaged or pledged as security
for a loan, Lessee shall not assign or sublet this Lease without the
written approval of the lender and the respective Federal Agency. Lessee
may assign the Lease and deliver possession of the Leased Premises,
including any improvements thereon, to the lender or its successors, or
Federal Agency guaranteeing or insuring the loan, if Lessee default(s)
in any mortgage or other loan agreement for which the Lease and/or
improvements on the Leased Premises are pledged as security, and, in
such event, the lender or its successors in interest may transfer this
Lease or possession of the Leased Premises to a successor Lessee;
provided, however, that the Lease may only be transferred to another
member of the Tribe or tribal entity. Nothing in this Lease shall
prevent the Lessee, with the approval of the Secretary of the Interior
and the Secretary of HUD (for Section 248 insured loans), from executing
and recording a mortgage, declaration of trust and/or other security
instrument as may be necessary to obtain financing for the purchase of a
dwelling, refinancing of an existing mortgage*,* construction and/or
improvement of a dwelling and related structures, or shall prevent the
mortgagee or other lender from foreclosing or instituting other
appropriate proceedings under law in the event of default of any
mortgage or other loan agreement by the Lessee, or assigns. Except in
cases involving loans for home construction or home improvement by a
bank, recognized lending institution, or a lending agency of the United
States Government, where no such consent or approval of Lessor shall be
required, Lessee may not execute a mortgage, declaration of trust or
other security instrument pledging their interest in this Lease or any
improvements on the Leased Premises without the prior written consent of
Lessor and the approval of the Secretary.

Notwithstanding the provisions contained above, the following additional
requirements shall be applicable to a Lease which secures a mortgage
insured, guaranteed or held by a Federal Agency:

RD Instruction 2000-NNN

Exhibit A

Attachment 2

Page 5

\(b\) Notwithstanding that the term sublease is used herein, the Lessee
shall not sublease the premises if the Lease is the security for a
mortgage insured under Section 248. The lessee may assign the lease in
accordance with the terms hereunder.

In the event a Federal Agency is the lender or acquires the mortgage
secured by this Lease, and subsequently acquires said Lease by
foreclosure, or by the assignment of said Lease by Lessee, his or her
(their) Lessees or assigns (for which the approval of the Tribe is not
required), then:

> \(1\) The appropriate Federal Agency, (the Agency involved in this
> transaction) will notify the Tribe of the availability of the Lease
> for sale, the sales price of the home and other terms of sale.
>
> \(2\) The Lease may only be assigned to another tribal member or
> tribal entity, except that the appropriate Federal Agency may lease
> the Leased Premises to a non-member under the conditions specified
> herein. Any such sublease or assignment shall be executed consistent
> with tribal law and Federal law.
>
> \(3\) If a purchaser is found, the Lease will be transferred by the
> Federal Agency, to the purchaser, with the prior written consent of
> the appropriate Tribe.
>
> \(4\) If a purchaser cannot be found, the appropriate Federal Agency,
> shall be entitled to sublease the Leased Premises and improvements
> without the prior written approval of the Tribe. Such sublease shall
> be to a member of the Tribe, unless a tribal member Lessee cannot be
> found, in which case the Federal Agency may sub-Lease to any
> individual. The term of the initial Lease period and any succeeding
> period shall not exceed one year each. Any purchase of the Lease shall
> be subject to any sublease by the Federal Agency pursuant to this
> subsection.
>
> \(5\) No mortgagee (except a Federal Agency as mortgagee or assignee
> of a mortgagee) may obtain title to the interest created by this Lease
> without the prior written consent of the Tribe.

(06-26-02) PN 347

RD Instruction 2000-NNN

Exhibit A

Attachment 2

Page 6

> In the event that the lender is the entity responsible for acquiring
> the Lease and the leasehold estate by foreclosure, the lender shall
> have the rights of the Federal Agency who had insured or guaranteed
> the foreclosed mortgage under subparagraphs (1) through (5) above,
> provided this sentence does not apply to loans insured under HUD/FHA's
> Section 248 program.
>
> 11\. OPTION. Subsequent to Lessee\'s breach of any covenant or
> agreement under a mortgage or other security instrument for which the
> Lease or any improvements on the Leased Premises are pledged as
> security, and upon the expiration of any applicable cure period, the
> Lessor shall have an option (the "option" herein) to acquire the
> Lessee's Leasehold interest, (subject to all valid liens and
> encumbrances) upon either payment in full of all sums secured by the
> mortgage or assumption of the loan with the approval of the lender or
> the applicable Federal Agency as evidenced by the note and mortgage
> and execution of an assumption agreement acceptable in all respects to
> the Lender. Such option is subject to the following conditions:
>
> \(a\) If the Lessee or any assignee of Lessee fails to cure the
> default, The lender shall give written notice to the Lessor and any
> applicable Tribal housing authority of Lessee's of its assignee's
> failure.
>
> \(b\) If the Lessee fails to cure the default, and said notice shall
> be given before the lender or successor invokes any other remedies
> provided under the mortgage or by law. Thereafter, the lender may
> issue an acceleration notice to the Lessee, its Lessees or assigns,
> under the mortgage or other security instrument, requiring the Lessee,
> its Lessees or assigns to pay all sums secured by the mortgage or
> other security instrument. If the Lessee, its Lessees or assigns fail
> to cure the default in accordance with the terms of the lender\'s
> acceleration notice, the lender shall give the Lessor written notice
> of said failure to cure. The Lessor may exercise its option at any
> time within thirty (30) days of the date of the lender\'s written
> notice to the Tribe of said failure to cure. This option shall be
> exercised by notice in writing from the Lessor to the Lessee and the
> lender.

\(c\) Notwithstanding the Lessor's option to acquire the Lessee\'s
interest in the Leased Premises, such option shall be subject to any
right the Lessee may have under the mortgage or by law to reinstatement
after the acceleration, and the right to bring appropriate court action
to assert the non-existence of a default or any other defense to
acceleration and sale or foreclosure.

RD Instruction 2000-NNN

Exhibit A

Attachment 2

Page 7

\(d\) The estate acquired by the Lessor through the exercise of the
option shall not merge with any other estate or title held by the Lessor
as long as the leasehold interest or any improvements on the Leased
Premises, or any interest therein, are mortgaged or otherwise pledged as
security for any loan, and the leasehold interest shall remain subject
to any valid and subsisting mortgage or other security instrument.

12\. RESERVATIONS: Lessee shall use the premises exclusively for
residential purposes, except as otherwise agreed to by the parties. Any
rights not expressly provided are reserved by the Lessor.

> Minerals: The Lessor reserves all rights, as owned by the Lessor, to
> all mineral rights, including but not limited to oil, gas, or
> hydrocarbon substances. The Lessor shall not exercise surface entry in
> connection with reserved mineral rights without prior consent of the
> Lessee and sureties (as found in 25 CFR 162 ).
>
> Timber: The Lessor reserves all rights, as owned by the Lessor to
> timber and forest products on the premises.
>
> Water: The Lessor reserves all rights, as owned by the Lessor, to
> water on the premises, except that which is needed for residential
> purposes.

13\. EFFECTIVE DATE. This Lease and all its terms and provisions shall
be binding upon the successors, and assigns of the Lessee and any
successor in interest to the Lessor, and shall take effect on the
[\_\_\_\_\_]{.underline} day of [\_\_\_\_\_\_]{.underline},
[\_\_\_\_\_]{.underline}, or upon the date of approval by the Secretary,
whichever is later.

14\. OBLIGATION TO THE UNITED STATES. It is understood and agreed that
while the Leased Premises are in trust or restricted status, all of the
Lessee\'s obligations under this Lease, and the obligation of his, hers
(theirs) sureties, are to the United States as well as to the owner of
the land.

15\. ASSENT NOT WAIVER OF FUTURE BREACH OF COVENANTS. No assent, express
or implied, to any breach of any of the Lessee\'s covenants, shall be
deemed to be a waiver of any succeeding breach of any covenants.

16\. VIOLATIONS OF Lease. It is understood and agreed that violations of
this Lease shall be acted upon in accordance with the regulations in 25
C.F.R. Part 162.

(06-26-02) PN 347

RD Instruction 2000-NNN

Exhibit A

Attachment 2

Page 8

17\. CARE OF PREMISES. It is understood and agreed that the Lessee is to
keep the premises covered by this lease in good repair. Lessee shall not
commit or permit to be committed any waste whatever on said premises and
shall not remove or tear down any building or other improvements
thereto, but shall keep the same in good repair. Lessee shall not
destroy or permit to be destroyed any trees, except with the consent of
the Lessor and the approval of the Secretary, and shall not permit the
premises to become unsightly. The Lessee will be held financially
responsible for all unrepaired damages to buildings, fences,
improvements or appearance, except for the usual wear and decay.

18\. FORCE MAJEURE. Whenever under this instrument a time is stated
within which or by which original construction, repairs or
re-construction of said improvements shall be completed, and if during
such period any cause reasonably beyond the Lessee's power to control
occurs, the period of delay so caused shall be added to the period
allowed herein for the completion of such work.

19\. INSPECTION OF THE PREMISES. The Secretary, lender, applicable
Federal Agency, and the Lessor and their authorized representative shall
have the rights, at any reasonable times during the term of this lease,
and with reasonable notice, to enter upon the leased premises, or any
part thereof, to inspect the same and all buildings and other
improvements erected and placed thereon.

20\. INDEMNIFICATION. Neither the Lessor nor the United States, nor
their officers, agents, and employees shall be liable for any loss,
damage, or injury of any kind whatsoever to the person or property of
the Lessee or sublessees or any other person whomsoever, caused by any
use of the leased premises, or by any defect in any structure erected
thereon, or arising from any accident, fire, or other casualty on said
premises or from any other cause whatsoever; and Lessee, as a material
part of the consideration for this lease, hereby waives on Lessee's
behalf all claims against Lessor and/or the United States and agrees to
hold Lessor and/or the United States free and harmless from liability
for all claims for any loss, damage, or injury arising from the use for
the premises by Lessee, together with all costs and expenses in
connection therewith.

21\. UTILITIES. Neither the Lessor nor the United States shall have any
obligation to provide utilities as of the commencement of this Lease. In
the event that the Lessee requires utilities, the installation and
maintenance thereof shall be the Lessee's sole obligation, provided that
such installation shall be subject to the written consent of the Lessor,
which the Lessor will not unreasonably withhold. The Lessee shall pay,
as they become due, all bills for electricity and other utilities that
are furnished to the leased premises.

RD Instruction 2000-NNN

Exhibit A

Attachment 2

Page 9

22\. LATE PAYMENT INTEREST. It is understood and agreed between the
parties hereto that, if any installment of rental is not paid within 30
days after becoming due, interest will be assessed at the existing prime
rate, plus three (3) percent, times the amount owned for the period
during which payments are delinquent. Interest will become due and
payable from the date such rental becomes due and will run until said
rental is paid. The interest rate formula is Interest = (Prime rate +
3%) times (x) amount due.

23 RIGHT OF REMOVAL. Upon the termination of the lease, the Lessee of a
one-unit single family dwelling shall be entitled, within
[\_\_\_\_\_]{.underline} days, to remove the dwelling and related
structures from the leased premises and relocate such improvements to an
alternative site, not located on the leased premises. Any Lessee who
exercises such a right shall be required to pay all costs related to the
relocation of the dwelling unit. Lessee shall leave the land in good
order and condition. All other improvements shall become the property of
the Lessor at the expiration of this lease. This paragraph does not
apply to Section 248 insured mortgage loans

24\. INSURANCE. The Lessee agrees, so long as this lease is in effect,
to keep buildings and improvements on the leased premises insured
against loss or damage by fire with extended coverage endorsements in an
amount equal to the full insurable value of the buildings and
improvements insured. Said policy is to be made payable to the Bureau of
Indian Affairs for the benefit of the Lessor. Said policy or policies
shall be deposited with the Secretary and Lessee shall pay all premiums
and other charges payable in respect to such insurance and shall deposit
with the Secretary the receipt for each premium or other charge as paid
or satisfactory evidence thereof. Except, during such time that a
mortgage is in effect against this Leasehold interest, that said policy
is to be made jointly payable to the Lessee and the Lender, and premium
payments provided for per specific requirements of the Lender.

25\. ADDITIONS. Prior to execution of this Lease, provision (s) number
(s) has (have) been added hereto and by reference is (are) made a part
hereof.

WITNESS:
[\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline},
Lessor

> \_ [\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline}\_

WITNESS:
\_[\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline}

> \_\_\_\_\_\_\_[\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline}
> , Lessee
>
> \_\_\_\_\_\_\_[\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline}

(06-26-02) PN 347

RD Instruction 2000-NNN

Exhibit A

Attachment 2

Page 10

APPROVED:

SECRETARY OF THE INTERIOR

[\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline}\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_[\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline}

BY: Date

This lease is approved pursuant to the authority delegated by

[\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline}

[\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline}

Approving Official

[\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline}

Date

## oOo 

RD Instruction 2000-NNN

Exhibit A

Attachment 3

Page 1

MEMORANDUM OF UNDERSTANDING

BETWEEN

THE [\_\_\_\_\_\_\_\_\_\_\_]{.underline}\_NATION

AND

**{fill in the name of the reviewing/approving Agency}**

Whereas, the Secretaries of Housing and Urban Development (HUD),
Veterans Affairs (VA) and Agriculture (USDA) are authorized to make,
insure and/or guarantee loans to American Indian borrowers for the
purchase of one-to-four family residences located on certain Indian
lands (as defined in each Federal Agency's authorizing statute), and

Whereas the Federal Agencies require, as a condition of making, insuring
or guaranteeing these mortgages, that the tribal organization which has
jurisdiction over the borrower enter into a Memorandum of Understanding
with the Departments with respect to such loans, and

Whereas, the signature on this Memorandum of Understanding of any one of
the Secretaries for the Department of HUD, VA, or USDA, is deemed to be
acceptable to each of the other Departments per the Memorandum of
Understanding between those Federal Agencies dated
[\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline}.

Now therefore, in consideration of the premises and other good and
valuable consideration, the parties hereto do agree and establish as
follows:

1\. [DEFINITIONS]{.underline}

> [American Indian or Native American]{.underline} shall refer to the
> borrower/mortgagor or Lessee as defined within each Agency's
> authorizing statute. Depending upon the authorizing statute, this may
> mean a member of a federally recognized tribe (Native American,
> Indian, Alaska Native individual or family), the tribe, a Tribally
> Designated Housing Entity (TDHE) or Indian Housing Authority (IHA).

(06-26-02) PN 347

RD Instruction 2000-NNN

Exhibit A

Attachment 3

Page 2

> [Borrower]{.underline} shall mean a federally recognized Tribe,
> Tribally Designated Housing Entity (TDHE), Indian Housing Authorities
> (IHA) or any American Indian, Native American(s), Indian or Alaska
> Native who has executed a Mortgage as defined in this document, or any
> heir(s) successor(s), executor(s), administrator(s) or assign(s) of
> the Tribe, TDHE, IHA or such American Indian, Native American(s),
> Indian or Alaska Native as may be eligible to participate in a
> federally sponsored loan program as defined in each Federal Agency's
> authorizing statute. [Eviction]{.underline} the legal process by which
> lessees in violation of their lease are removed from occupancy of a
> given residence.
>
> [Federal Agency]{.underline} shall refer to the U.S. Department of
> Housing and Urban Development (HUD), the U.S. Department of Veterans
> Affairs (VA) and the U.S. Department of Agriculture (USDA).
>
> [Federally sponsored loan program]{.underline} refers to the loan
> programs, sponsored by HUD, VA and USDA whose purpose is to provide
> homeownership opportunities to Native Americans, American Indians or
> Alaska Natives on certain Indian lands as defined within each of those
> Federal Agency's authorizing statutes.
>
> [Leasehold interest]{.underline} is the name given to the interest
> conveyed by the tribe to the borrower under the lease. It consists of
> the right to the quiet enjoyment of the leased premises for the term
> of the lease, subject to the requirements of the lease.
>
> [Lender]{.underline} shall refer to any institution that the specific
> Federal Agency has approved to originate or service Mortgages made,
> insured or guaranteed under its programs. The term "lender" also
> includes any of the lender's successors or assigns of the lender's
> right, title to, or interest in, the Mortgage, including any
> subsequent noteholder and mortgagee and, without the consent from the
> tribe, any secondary mortgage market investor. In some cases, the
> lender may be the appropriate Federal Agency which is sponsoring a
> direct loan program.
>
> [Mortgage]{.underline} shall mean a mortgage loan made to an eligible
> borrower for the purchase or refinance of the borrower's real property
> interest (which may be a leasehold interest) in the trust land,
> restricted land or fee simple land, as applicable, and made in
> accordance with a Federally sponsored loan program and complying with
> the terms and conditions of the lender's mortgage program. The
> mortgage loan shall be either a first lien or a second lien, in
> accordance with the Federally sponsored loan program requirements.

RD Instruction 2000-NNN

Exhibit A

Attachment 3

Page 3

> [Secretary]{.underline} shall mean the Secretary of the U. S.
> Department of Housing and Urban Development (HUD) or the Secretary of
> the Department of Veterans Affairs (VA) or the Secretary of the U.S.
> Department of Agriculture (USDA).
>
> [Tribe]{.underline} shall refer to any Indian tribe, band, nation, or
> other organized group or community of Indians, including any Alaska
> Native village or regional or village corporation as defined in or
> established pursuant to the Alaska Native Claims Settlement Act, that
> is recognized as eligible for the special programs and services
> provided by the United States to Indians because of their status as
> Indians pursuant to the Indian Self-Determination and Education
> Assistance Act of 1975. For the purpose of this specific Memorandum of
> Understanding, Tribe refers to the [\_\_\_\_\_\_\_\_\_]{.underline}
> Indian Nation, a federally recognized tribe, of the
> [\_\_\_\_\_\_\_\_\_]{.underline} Indian Reservation as defined in the
> Tribal constitution, ordinance or other enabling document.

2\. [AGREEMENT]{.underline}

> \(a\) That the Department of HUD, VA and/or USDA, will make, insure
> and/or guarantee mortgages available to qualified American Indian
> borrowers for the purchase, construction or rehabilitation of homes on
> Indian lands or refinances of such mortgages to the extent funds are
> available and subject to such terms and conditions as may be
> established by the Secretary of the applicable Federal Agency.
>
> \(b\) That the [\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline} Tribe has
> established standards and procedures that apply to the conveyance of a
> leasehold interest in real property by an American Indian
> borrower/mortgagor to a lender, Federal Agency or their assignee as
> security for the loan, including procedures for foreclosing the
> interest, eviction and procedures for resale of the lot or the
> dwelling (or both) purchased, constructed, rehabilitated or refinanced
> using the proceeds of the loan. It is agreed that for the purpose of
> foreclosure and eviction actions, the court of jurisdiction is ( ) the
> State of [\_\_\_\_\_\_\_\_\_\_]{.underline}, or ( ) the Tribal court ,
> or ( ) the Federal Court.
>
> (c ) That each American Indian who is under the jurisdiction of the
> Indian tribe and to whom a lender and/or Federal Agency makes direct,
> insures or guarantees a loan, holds, possesses or will obtain a
> leasehold or other acceptable interest in a lot that is located on
> Indian land and will purchase, construct, rehabilitate or refinance a
> dwelling on that lot with the proceeds of the loan.

(06-26-02) PN 347

RD Instruction 2000-NNN

Exhibit A

Attachment 3

Page 4

> \(d\) That each such American Indian will convey the above described
> interest to the lender and its assignees as specified in the
> borrower/mortgagor's loan documents, by an appropriate instrument, as
> security for the loan made pursuant to that Federal Agency's
> authorizing statute.
>
> \(e\) That the tribe and each borrower/mortgagor who obtains a loan
> from a lender or Federal Agency under this agreement will permit the
> lender and/or the Federal Agency, its agents and employees to enter
> upon the land of the tribe and the borrower/mortgagor for the purpose
> of carrying out such actions as the lender and/or Secretary determines
> are necessary to evaluate the advisability of the proposed uses of the
> proceeds of the loan and to service the mortgage according to the
> applicable Agency's requirements.
>
> \(f\) With respect to any leasehold estate financed by a loan, the
> tribe, as lessor, agrees that it shall not attempt to cancel, modify,
> amend, terminate, surrender or forfeit such a leasehold estate without
> the prior written consent by the Lender and the Secretary of the
> Federal Agency that has made direct, insured or guaranteed the loan,
> as long as such a loan remains outstanding. With regard to any loan
> submitted to HUD, VA or USDA for guarantee or insurance, the
> authorizing Federal Agency shall have the same rights as the lender
> with regard to that loan and the security. No action with regard to
> the loan or security that requires consent of the lender shall be
> taken unless the Federal Agency also consents, so long as the
> guarantee or insurance remains in effect or the Federal Agency has an
> interest in the security.
>
> \(g\) The tribe will to the maximum extent possible, assist the lender
> and the Federal Agency in its efforts to manage this program in a
> prudent and cost-effective manner. This will include assisting the
> lender or Federal Agency in finding qualified substitute purchasers if
> the initial borrower/mortgagor is unable to fulfill his or her
> obligations under the law. This may include carrying out evictions,
> assuring that mortgages and other legal instruments can be properly
> recorded and otherwise assuring that the program is operated in a
> responsible and prudent manner.

RD Instruction 2000-NNN

Exhibit A

Attachment 3

Page 5

In Witness whereof, the parties hereto have signed this agreement as
follows.

[\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline}
DATE [\_\_\_\_\_\_\_\_\_\_]{.underline}

**{fill in name of the reviewing/approving Agency)**

[\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline}
DATE [\_\_\_\_\_\_\_\_\_\_\_]{.underline}

XXXXXXXXXXXXXXXX

XXXXXXX Tribe

> Does the above named Tribe have constitutional authority to sign this
> Memorandum of Understanding without approval of the US Department of
> the Interior's Bureau of Indian Affairs?

\_[\_\_\_]{.underline} Yes \_[\_\_\_]{.underline} No

If no, below is the approval of the Bureau of Indian Affairs.

[\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline}\_\_\_\_\_
DATE [\_\_\_\_\_\_\_\_\_\_\_]{.underline}

BIA Approving Official

## oOo

(06-26-02) PN 347

RD Instruction 2000-NNN

Exhibit A

Attachment 4

Page 1

**Attachment 4**

**Checklist for Tribal Approval for Participation in Mortgage Loan
Programs Sponsored by the U.S. Departments of Housing and Urban
Development, Agriculture and Veterans Affairs.**

> 1\. Evidence that the tribe has enacted legally binding and effective
> foreclosure procedures and will enforce those procedures upon notice
> of default from a lender and/or Agency noted above.
>
> 2\. Evidence that the tribe has enacted legally binding and effective
> eviction procedures and will enforce those procedures upon notice of
> default from a lender and/or an Agency noted above.
>
> 3\. Evidence that the tribe has adopted procedures ensuring that the
> Federally guaranteed or insured loan will always have first lien
> priority ([if applicable]{.underline}) and will be satisfied before
> all other property debts (excepting tribal taxes) OR has adopted
> legislation requiring the tribe to follow state or local priority of
> lien procedures.
>
> 4\. A copy of the tribe's lease for use on residential land.
>
> 5\. Submission of an affirmation signed by the tribe stating that the
> tribe understands the importance of maintaining and enforcing these
> procedures.
>
> 6\. Submission of an affirmation signed by the tribe stating that the
> tribe agrees that it will permit HUD, USDA and VA and/or the lender or
> their agents to access mortgaged properties for the purpose of
> evaluating and servicing loan-related items.

## oOo

(06-26-02) PN 347