Native American Banking Forum
October 16, 2002

Neighborhood Reinvestment Corporation
 Congressional Chartered National Non-profit
 Annual Budget $105,000 million
 Support the National NeighborWorks Network(r) which consists of 225 non-profit partnerships across the country
 Network production

Neighborhood Reinvestment Corporation
 National NeighborWorks Network(r) CDFI's
 Ellen Lazar-Executive Director

Neighborhood Reinvestment Efforts in Indian Country
 Navajo Partnership for Housing
 Sicangu Enterprise Center-Rosebud Reservation
 Existing NeigborWorks Organizations extending services to Indian Country

Montana Homeownership Network

History
 Navajo Nation Div. of Economic Development
 OCC, Federal Home Loan Banks
 Assessment
 Organizational Development Process
 Incorporated in 1996 on Navajo Nation
 Chartered 1998 as a member of the National NeighborWorks Network(r)

Mission
Partnership-Board of Directors
 Residents on the Navajo Nation
 Representatives of Government
 Representatives of Business

Programs
"Sheltering Our People" Homebuyer Education
 Preparing for Homeownership "Laying the Foundation"
 Family Budgeting "Setting the Cornerstone"
 Credit "Building Block or Stumbling Block"
 Owning a Home on Tribal Land "Following the Blueprint"
 Mortgage Lending "Raising the Structure"
 Life As a Homeowner "The Finishing Touches"

Homebuyer Education Staff

Homebuyer Orientation Schedules

Homebuyer Education Schedule

Construction and Real Estate Development Services
 Assisting customers in identifying floor plans
 Developing specifications
 Selecting a contractor
 Monitoring Construction
 Post-Occupancy Support
 Site Acquisition and Development
 Home Sales

Examples of Homes

Home Loan Services
 Identification of Loan Products
 Identification of Secondary Financing
 Loan Packaging
 Loan Closing

First National Bank-Colorado
 5 Construction Loans made
 4 loans in the pipeline

Outcomes
 38 Rural Development Rehab Projects
 15-RD 502 Direct loans
 14 Conventional Loans
 2-HUD 184 Loan
 3 Other Loans
----------
 70 single family projects

Outcomes
 Defining and Improvement the System
 Graduating 600 families per year in Homebuyer Education
 Gradual Change in expectations related to how housing is financed and how much it costs
 Leverage over $2.5 milllion 
 One Stop Mortgage Initiative

Developing a "Buy and Sell Real" Estate Market

Customer Demographics
 Income
 Debt
 Savings
 Household Size
 Household Type

Benefits of Local Intermediaries

Mortgage Lending Process in Indian Country

Contact made to Lender/Government Agency
 Applicant receives loan application for:
 Section 184 Indian Guarantee
 Section 248 Mortgage Insurance Program
 Section 502 Loan Guarantee (RHS)
 Conventional Loan Products

Contact made to Non-Profit
 Receives Orientation on programs & Types of assistance
 Pre-qualified for loan products
 Prepares necessary documentation
 Provides Homebuyer Education
 Budgeting
 Credit
 Homeownership


Verification & Eligibility
 Tribal Membership
 Same name, census number and address as on lease
 Program Compliance
 Land Status
 Fee Simple:  No Restrictions against alienation or encumbrance; land serves as collateral.

Land Status Continued....
 Tribal Trust:  Restrictions against alienation or encumbrance; leasehold interest serves as collateral
 Individual Trust/Allotted:  Restrictions against alienation or encumbrance; Allottee must document interest in land to serve as collateral.

Fee Simple
 Lender/Agency:
 Prepares Credit Package
 Orders Appraisal for an existing house or new construction
 Approves borrower
 Closes Loan
NOTE:  FHA 248 Not eligible for Fee Simple

Recording/Final Steps
 Lender/Agency submits loan documents for filing with the local county records office
 Final Steps:
 Lender/Agency reviews closing package for:
 Program Compliance
 Issuance of Guarantee Certificate if Government Insured
 Sold to Secondary Market
 Conventional
 Government Guaranteed

If Tribal Trust
 Tribe assigns parcel of land and issues lease to applicant
 Tribe submits executed lease to the BIA for approval/recording
 BIA verifies legal description, ownership, existing encumbrances, issues preliminary Title Status Report (TSR) to lender/government agency
If Allotted/
Individual Trust
 Lender/Agency contacts BIA to obtain a Title Status Report (TSR) to verify applicant's interest in land, legal description & existing encumbrances

Leasehold 

Mortgage Approval
 Lender/Agency:
 Compiles Credit Package
 Orders Appraisal
 Reviews executed lease by Tribe, BIA, & Borrower for program compliance
 BIA Realty Officer provides Certificate of Approval

Trust Mortgage Approval
 Lender/Agency:
 Prepares Credit Package
 Orders Appraisal
 BIA Realty Officer provides approval for encumbrance of land.

Loan Approval on Leasehold
 Lender/Agency approves and closes Loan with Borrower
 Lender/Agency submits  mortgage documents to Tribe/BIA for:
 Signature & Approval of Mortgage
 Recording of Mortgage Documents
 BIA submits final TSR to Lender/Agency

Loan Approval on Allotted
 Lender/Agency:
 Approves borrower on individual/allotted land
 Closes Loan
 BIA Credit Officer and Realty Officer
 Approves Credit Package
 Lender/Agency submits  mortgage documents to BIA for:
 Signature & Approval of Mortgage
 Recording of Mortgage Documents
 BIA submits final TSR to Lender/Agency

Final Steps
 Lender/Agency reviews closed package for program compliance and issuance of guarantee certificate if government insured loan
 Secondary Market:  Conventional & Government loans may be sold in the secondary market.