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ITMO

Program Overview

ITMO (short for "Indian Tribe Mortgage") is a down payment loan program offered by the Lower Brule Sioux Tribe to low-to moderate-income home buyers purchasing homes with Federal Housing Administration ("FHA")-insured mortgages in the United States and its territories.

ITMO provides a silent second loan ("ITMO Loan") that requires no monthly or amortized payments.

The principal amount plus interest accruing at an annual rate of three percent (3%) becomes due upon sale, refinance, or transfer, whichever comes first, or is forgiven if none of these events occur within the first seven years of ownership. In addition, if fifty percent (50%) of the ITMO Loan is repaid within eighteen (18) months from the purchase date, then the remaining 50% of the ITMO Loan is forgiven.

The ITMO Loan will subordinate to first mortgage and the ITMO Loan lien will always be in the second position on the property. ITMO borrowers receive ongoing home retention assistance from a Home Retention Entity (described below). The Home Retention Entity assists program participants to remain in their homes while increasing the credit quality of ITMO Loans which is essential to the continued availability of the program.

ITMO Features

  • (1st Mortgage) FHA qualifying guidelines
  • (2nd Mortgage) 7-year fixed rate (3%), no prepayment penalty, forgiven after 7 years
  • Maximum ITMO loan is 3.5% of the contract sales price
  • Borrower income must not exceed 120% of Area Median Income
  • Borrower provided with ongoing home retention services
    (housing counseling, loss mitigation and emergency assistance)

Who is Eligible?

  • Borrowers who have been pre-approved for a FHA-insured first mortgage through a Participating Lender
  • Borrowers whose "Qualifying Income" (income used to qualify for first mortgage) does not exceed 120% of Area Median Income
  • Borrowers who are purchasing homes under terms that meet program guideline requirements

Participating Lender Requirements

Participating Lenders must be affiliated with a FHA-approved Single Family Originator as reflected on the HUD list of approved Lenders (www.hud.gov).

Lenders seeking approval to participate in ITMO should fax a letter on company letterhead to "ITMO" at (888) 838-5617. This letter should include:

  1. Contact Person with phone, fax, and email information (required)
  2. nature of relationship with FHA lender (e.g., employee, correspondent, etc.)
  3. a statement that the contact person and affiliate entity are in good standing with all appropriate licensing authorities.

Lender applicants should receive written confirmation of their eligibility to participate in the ITMO within ten (10) business days of receipt of the letter requesting approval.

Upon approval, the Lender applicant will be emailed a password to access the ITMO Documents.

Borrower Application Procedures

Borrower Applicants must complete an ITMO Loan Application. Participating Lenders must submit a completed and executed ITMO Loan Application along with a pre-approval or pre-commitment lender for the First Mortgage to ITMO via fax at (888) 838-5617.

Notification of approval status via fax should be received within five (5) business days of receipt of a completed application.


 

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