1. New Mexico Housing Summit
Construction Leveraging and Funding Through Rural Housing Service
September 21, 2016

2. Programs Homeownership Home Repair Multi Family / Rental Housing
Direct & Guaranteed Loans, Site Loans, loan packaging
Home Repair
Grants and Loans
Multi Family / Rental Housing
Community Facilities
Water and Environmental
Business and Cooperative 7

3. 2009 - 2015 Summary of Investments
$3.1 billion benefitting American Indians & Alaska Natives
Including:
Home Ownership Loans = $886.7 million (6,796 loans)
Water and Environmental = $497.6 million
Community Facilities = $577.4 million
Broadband/Telecom = $372.2 million
Electric = $596.1 million
Rural Business and Cooperative Programs = $159.1 million
FY 13 2nd Highest…$628.4 million

4. Single Family Housing Programs
502
Direct Loans
Guaranteed Loans
504
Repair Loans
Repair Grants
502/504
Loan Packaging
523
Mutual Self Help Assistance Grants
524
Site Loans
Contact:
State and/or Local Office 8

5. Sec. 502-Single Family Housing Direct Loans
Lease & Ordinance Review (One-Stop)
Low & Very-Low Income Borrowers
Mortgages are fixed rate for years
Interest Rates (as low as 1%)
100% financing available.
$140,000 loan at 1%=$450.00/month
Loan Packaging – Formal and Informal
Very low income is defined as below 50 percent of the area median income (AMI); low income is between 50 and 80 percent of AMI; moderate income is 80 to 100 percent of AMI
Applications & loans are processed at local RD office
Loan can be used either as a down payment assistance to enable purchase with a loan through a private lending source, or as a sole source of assistance for those unable to obtain any part of the needed credit from another lending source
HUD low and very-low income limits apply
Loans can be on Tribal Trust land with approved lease and ordinances
National Office reserve for certain targeted groups
If loan default or in Government inventory (REO), RD can only transfer property to Tribe, Tribal Housing Authority or another member of the Tribe
Manufactured housing for new construction only
No waiver of Sovereign Immunity required (this applies to all RD activity)
Be unable to obtain a loan from other sources on terms and conditions that they can reasonably be expected to meet
A Tribe/TDHE may be able to refinance existing rental housing stock and use the proceeds from the sale to build new homes.
o Example: Tribe/TDHE owns an existing home that is being rented out to an individual (renter). The renter wants to own the home and can qualify for a 502 mortgage. The renter (502 borrower) uses the loan to pay the Tribe for the home. The Tribe can use the revenue from the sale to meet other housing needs 5

6. National American Indian Housing Council June 2014
Leveraging 502 Direct Loans with affordable housing products can make a difference
Total Home cost including closing cost $ 104,000 USDA RD Loan $62,000 BIA HIP Program grant $ 17,000 FHLBDM AHP grant $ 25,000 Payment which includes $ 75 per month for insurance Rural Development note rate (2.875%) $ 244 monthly or Rural Development subsidized rate( 1.0%)$ 185 monthly
FHLBDM is the Federal Home Loan Bank of Des Moines. It is one of the Federal Home Loan Bank System which covers the entire US. They all have in their mission area to support Affordable housing and are required to set-aside a part of their net profit to funds Affordable Housing Programs. Federal Home Loan Bank of Des Moines program is structure through their member institution who which to provide grants to developers of low income projects and many tribes on South Dakota take advantage of this grant program. Sisseton Wahpeton Oyate received grant funds for down payment or loan reduction from Federal Home Loan Bank through Dacota Bank (member institution) -this grant was $25,000 per home with a 5 year forgivable mortgage filed.
Bureau of Indian Affairs recently expanded the use of their House Improvement Program (HIP) to include down payment assistance for very income families to purchase homes. HIP is a down payment program that administered by the local tribal HIP Director or HIP Manager. Every tribe should have a HIP director or manager & that would be your first contact. The HIP director works with BIA on the home ownership down payment program. The HIP is up to 20% of total cost project cost or $ 20,000.
National American Indian Housing Council June 2014

7. RCAC also includes: Alaska, Hawaii and the Western Pacific
NW Regional Housing Development Corporation
also includes: The Virgin Islands and Puerto Rico
Packaging for 502 – The certified packaging process was created as a means to outreach and to increase the number of very low and low-income applicants. In addition, certified packagers assist RD staff with assembly of complete applications, which in turn allows staff to focus their time on loan origination and underwriting. The partnership created by the certified packaging process includes a quality assurance review by the intermediary (when present), thus helping to ensure what is received by the Agency is a quality product
Tribal Housing Authorities and TDHE’s are eligible to be Certified Loan packagers. Attached is a map of Intermediary Territories. NM is covered by Tierra Del Sol and RCAC. Benefits over informal packaging process are Intermediary help and a larger fee. The packaging fee is $1500 to be shared with the Intermediary.
Training opportunities through nonprofits –
Non-Agency Points of Contact
Housing Assistance Council
(HAC)
Primary: Jeff Mosley
Secondary: Shonterria Charleston
Primary:
Secondary:
Prefers contact by
NeighborWorks America Dale Prunoske
Senior Manager, Curriculum and Training
999 N. Capitol St. NE, Suite 900
Washington, DC 20002
Rural Community Assistance
Corporation (RCAC)
Angela Sisco
Rural Development Specialist – Housing
(208)

8. Section 504-Single Family Housing Home Improvement Loan & Grant Program
Very low income homeowners may qualify for 20 year, 1% loans for repairs, improvements, modernization or accessibility modifications up to $20,000
Elderly (62 yrs and older) homeowners who cannot repay the entire loan amount may qualify for a $7,500 lifetime grant which can be used to address health or safety hazards, and accessibility modifications.
FY 16 Funding
$29.9 Million (grants)
$26.2 Million (loans)
Very low income homeowners may qualify for loans of up to $20,000, term up to 20 years, at 1% fixed interest rate
If under $7,500 – note only feature.
If 62 or older and VL income – and can’t repay a loan, up to $7,500 grant. Or grant and loan combo.
$7,499 loan. $20,000 loan for $92/month. Many loans on trust land are $7,499.
A grant/loan combination is made if the applicant can repay part of the cost
Funds are available for repairs to improve or modernize a home and remove health & safety hazards. Can be used to make homes accessible for disabled. Water, waste systems are eligible uses.
Must be the owner/occupant of a modest single family home. Leasehold interest of trust land is acceptable with certain terms including HUD mutual help housing on Indian lands.
Homeowner-occupants must be unable to obtain affordable credit elsewhere and must have very low incomes, (below 50 percent of the area median income).
Minimal paperwork
Matches well with BIA HIP funds
Work with State office and execute a packaging memorandum of understanding for 504 loans and grants, as well as 502 loans. 8

9. Mutual Self-Help Housing Overview
Technical assistance grants (not for construction), are available to Tribes, Non-Profits, and Public Agencies to supervise groups of 4 to 12 direct loan applicants build their own homes.
Technical assistance grantees are active in 35 states, and Puerto Rico.
65% of the required labor is provided by the homebuyers, but remaining work is subcontracted to qualified contractors (typically excavation, foundations, HVAC, electrical, and plumbing).
Once all homes in a build group are completed, the new homeowners can move-in. 9

10. Zuni Pueblo Self-Help Grant
A technical assistance grant was provided to the Zuni Pueblo Housing Authority to work with Seven 502 loan borrowers to build their homes. The borrowers are responsible to provide 65 percent of the labor under the construction supervisor’s supervision but certain things are contracted out. For example – the pouring of the foundations, like you see here.

11. Here is a picture of the first borrowers on the day they received the keys to their new homes.

12. Section 523 and 524 Site Loans
Section 523 loans are used to acquire and develop sites only for housing to be constructed by the Self-Help method.
Section 524 Loans -The developed sites may be sold to low- or moderate-income families utilizing USDA’s Housing loan programs, or any other mortgage financing program which serves low- and moderate-income families.
Eligible applicants include:
Private or public non-profit organizations. 
Federally-recognized Tribes
Section 524 loans are made to acquire and develop sites for low- or moderate-income families, with no restriction as to the method of construction.  Low-income is defined as between 50-80% of the area median income (AMI); the upper limit for moderate income is $5,500 above the low-income limit
Who may apply for this program?
Section 523 loans: Private or public non-profit organizations that will provide sites solely for self-help housing
Section 524 loans: Private or public non-profit organizations.  The building site may be sold to low- or moderate-income families utilizing USDA’s Housing and Community Facilities Program’s (HCFP) loan programs, or any other mortgage financing program which serves low- and moderate-income families
Non-profits that have the legal authority to operate a revolving loan fund
Non-profits that have the financial, technical and managerial capacity to comply with relevant federal and state laws and regulations
Federally-recognized Tribes
What is an eligible area? Check eligible addresses.
How may funds be used? Site loans are made to provide financing for the purchase and development of housing sites for low- and moderate-income families.
What are the terms of the loans?
2-year loans
Section 523 loans: 3% interest rate
Section 524 loans: market rate -- at the discretion of the customer, either at loan approval or closing
How do we get started? Applications for this program are accepted year round. Please apply through your State USDA Rural Development office..
Who can answer questions? Contact your State USDA Rural Development office 12

13. Sec. 502-Single Family Housing Guaranteed Loans
Lease & Ordinance Review
Applications made with approved lenders
Mortgages are 30 years fixed rate
100% Financing Available
Interest rates are negotiated with the lender
There is no maximum loan amount
Closing costs and repairs can be financed with the home purchase
FY 16 Funding ~ $24 Billion
Upfront Fees:
Purchase & Refinance: 2.75%
Annual Fees:
Purchase & Refinance:.40%
Properties financed must be in rural areas
Available on Tribal Trust lands with approved lease and foreclosure ordinances
90% Guarantee
There is no required down payment.
The lender must also determine repayment feasibility, using ratios of repayment (gross) income to PITI and to total family debt.
Applicants for loans may have an income of up to 115% of the median income for the area.
Fee are going down October 1st to 1 percent upfront and .35 annual. 13

14. Section 502-Single Family Housing Guaranteed Loans
Eligible lenders:
Community Development Financial Institutions
CDFI are eligible to participate in the Guaranteed Loan Program if they are supervised by a Federal regulatory agency
Credit Unions
Credit unions are able to participate if they are supervised by the National Credit Union Administration
Community Banks
Informal packaging opportunity. Work with NCDFI’s, If can’t qualify for guarantee – they may be eligible for a loan at 1 percent interest rate. Packaging fee of $350 or $500 for home repair. 14

15. Multi-Family Housing Programs
533
Housing Preservation Grants
515
Direct Loans
538
Guaranteed Loans
Housing can be on or off trust land
Contact:
State and/or Local Office 15

16. Section 533 Housing Preservation Grant Program
Provides grants to sponsoring organizations for the repair or rehabilitation of housing occupied by low and very low income people.
Eligible applicants include:
Federally Recognized Tribes
Most State and local governmental entities
Nonprofit organizations
Individual homeowners are not eligible 16

17. Sec. 538 Guaranteed Rural Rental Housing
Eligible lenders must be approved and active in one of the following programs:
Fannie Mae, Freddie Mac, Ginnie Mae
HUD
Federal Home Loan Bank members
State or local housing finance agencies
Eligible borrowers include:
Most state and local governmental entities
Nonprofit organizations
For-profit organizations, including LLC's
Federally-recognized Tribes

18. Community Facilities Programs
Contact:
State and/or Local Office
Grants
FY 16 ~ $25.7 Million
Tribal College Initiative ~ $4 Million
Economic Impact Grants ~ $6.6 Million
Direct Loans
Poverty, Intermediate and Market Rates
FY 16 ~ $2.2 Billion
Guaranteed Loans
Negotiate interest rate
FY 16 ~ $246 Million
Rural Community Development Initiative (RCDI)
FY 16 ~ $8.5 Million
A Community Facility Project may complement housing development within a community. For example, an eligible Tribe or TDHE may use CF program funds to build community buildings such as day care centers or community centers.
Grant funds may be used to assist in the development of essential community facilities. Grant funds can be used to construct, enlarge, or improve community facilities for health care, public safety, and community and public services. This can include the purchase of equipment required for a facility's operation.
A grant may be made in combination with other CF financial assistance such as a direct or guaranteed loan, applicant contributions, or loans and grants from other sources.
Types of Eligible Grant Projects
Fire, rescue, and public-safety vehicles
Equipment for:
Community health facilities
Educational and cultural facilities
Community support facilities 18

19. Sisseton Wahpeton Oyate Tribal Headquarters located on the Lake Traverse Reservation in northeastern South Dakota and southeastern North Dakota. A $31,200,000 Direct CF loan to build a new Tribal Headquarters. The building consolidates 28 public service Tribal departments, programs and agencies; serving as a central hub and assisting tribal members with tier social, educational and housing needs.
Sisseton Wahpeton Housing Authority
Agency Village, South Dakota
Administrative Building
Project Cost $ 1,323,250
RD CF loan $ 743,250
NAHASDA  $ 580,00
Oglala Sioux Lakota Housing Authority
Pine Ridge, South Dakota
Project Cost $ 3,625,000
RD CF loan    $ 3,625,000

20. In New Mexico, the Northern Pueblos Housing Authority a CF $100,000 loan/$50,000 grant for the design and installation of solar panels on the Picuris Pueblo fire station. The NetZero fire station was built leveraging USDA CF program funds with a HUD Indian Community Block Grant. The investment provides the Pueblo and surrounding rural communities with full service fire protection year round.

21. Water & Environmental Programs
Water & Waste Disposal Loans & Grants
FY 16 Direct Loans ~ $1.4 Billion
FY 16 Grants ~ $361.1 Million
Another $ 25 million for federally recognized Tribes
Another $39.6 million for Rural Alaska Village Grants
Technical Assistance & Training Grants
FY16 ~ $20 million
Solid Waste Management Grants
FY16 ~ $4.2 million
Contact:
State and/or Local Offices
Water and Environment Programs or WEP loans may be used to install new or improve existing water and wastewater systems. These systems may benefit Tribal housing development and may reduce the cost of housing for prospective homeowners and renters.
Chehalis Tribe Water Towers 21

22. In New Mexico, the Pueblo of Jemez was awarded a $1,000,000 WEP grant to upgrade an existing water line and tank at the Pueblo, as well as extend new wastewater infrastructure to the Pueblo Place Housing Project. The multi-phase project will serve both existing and proposed housing on the Pueblo.

23. Rural Business & Cooperative Programs
FY16 ~$4.3 million
FY16 ~$1.9 million
Set Asides for Federally Recognized Tribes
Rural Business Development Grants
(RBDG) = RBOG + RBEG
FY16 ~ $22.8 million
Intermediary Relending Program
(IRP)
FY16 $13.2 million
Business and Industry (B&I) Guaranteed Loans
FY16 ~ $1.5 billion
Rural Energy for America Program (REAP)
Renewable Energy Systems and Energy Efficiency Improvements
Grants and Loan Guarantees
Value Added Producer Grant
FY 16 ~ $44 million
Contact: State and/or Local Office
Rural Business Development Grants –
This program provides grants for rural projects that finance and facilitate development of small and emerging rural businesses help fund distance learning networks, and help fund employment related adult education programs. To assist with business development, RBDGs may fund a broad array of activities. It is well worth a visit to the link at the bottom of the slide.
Intermediary Relending Program or IRP - What does this program do? Provides 1% low-interest loans to local intermediaries (such as non-profits, public agencies and Federally-recognized Tribes to re-lend to businesses and for community development projects in rural communities.
How may funds be used?
The acquisition, construction, conversion, enlargement, or repair of a business or business facility, particularly when jobs will be created or retained
The purchase or development of land (easements, rights of way, buildings, facilities, leases, materials)
The purchase of equipment, leasehold improvements, machinery, or supplies
Start-up costs and working capital
Pollution control and abatement
Transportation services
Feasibility studies and some fees
Hotels, motels, convention centers
Education institutions
Aquaculture based rural small business
Revolving lines of credit as described in 7 CFR Part
Rural = 50,000 or less for B&I and RBDG
Rural = 25,000 or less for IRP 23

24. National American Indian Housing Council June 2014
Website screen shot
National American Indian Housing Council June 2014