OCTOBER 15, 2003
Smoke Signals 3
Tribal Members Cash In Ori Recent Federal Refinance Program
Refinance continued from
front page
soon after the groundwork on the
development was finished.
Tracy has been a Surveillance
Technical Supervisor at Spirit
Mountain Casino "since before day
one," and Jerri also works for the
casino. Both are very care
ful about their real estate
investments, and had been
looking for an opportunity
to refinance from about a
year after they moved in.
"We arrived in 1998," said
Tracy, "and in 1999, inter
est rates started to drop."
Today, their house is
fenced with a beautiful
porch leading out into the yard and
a pool out front in summer. Oh
yeah, and little Sydney, 1, has since
arrived on the scene.
All this has been made possible by
Section 184 of the Housing and
Community Development of 1992
that guarantees home loans on
Tribal property. Until February of
this year, however, Tribal members
had not been able to refinance their
homes.
Within days of a Smoke Signals
article (2103 issue) detailing
the problem, the federal pro
gram opened the doors to this
refinancing opportunity, and in
no time, more than half of the
homeowners in Grand Mead
ows had taken advantage of the
opportunity.
The Howertons were among
them. "Property information is
something we watch very care
fully," said Tracy. The family
already owns a rental in Salem,
and "we would like to have
enough capital to buy another
house," he said.
The $130 a month that the
Howertons save as a result of
refinancing won't quite pay for
another house, but "it affords
us more things for the kids,"
said Howerton, "and (Jerri)
doesn't have to work full time. It
makes it that much easier for us to
sustain our life-style."
In all, 25 of 31 homeowners in
Grand Meadows have refinanced.
Not many of the remaining six
needed to refinance, according to
Valerie Harjo, a Tribal Housing
Board member and previously an
Indian housing specialist with Wells
Fargo Home Mortgage. Harjo is
now a loan officer with GMAC Mort
gage. Either they had recently pur
chased or had purchased their
homes outright, she said.
Savings came in a number of
forms. Some saved more because
they initially purchased their
homes at a higher interest rate.
Others cut their payment term from
30 years to fifteen years, and in
ditional home may not be realized
as a result, the problem points up
potential issues for many
homeowners on Tribal land.
"Everybody wants to move up,"
said Howerton, and ultimately, he
will be looking to the Tribal Coun
cil for help if he ever decides to sell
am
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those cases, payments were about
the same with the new lower rates.
To date, nobody has pulled
money out of the value of the house
with the refinance. "The program
is a streamlined refi with no cash
back and no credit qualifying," said
Harjo. "The BIA (Bureau of In
dian Affairs, which approves all
loans for housing on Tribal prop
erty) has indicated that any cash
out will be looked at very closely."
Issues for the near and long term
his property and there is nobody of
Grand Ronde or Indian ancestry
interested in buying. "That's go
ing to be the biggest issue in 10
years," he said.
At the same time, said Harjo, the
Tribal Housing Board has been
hearing about other possibilities for
the future from the national asso
ciation. In the future, she said,
"Lenders might not be the most ef
fective way. Looking down the
road, there may be some other av-
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New Savings Tribal Elder Bud White and his wife Anna, were among the first to refinance
their home in Grand Meadows. Here, they sign the papers with Debbie Clark, Escrow Officer with
Ticor Title Insurance of McMinnville.
remain for homeowners in Grand
Ronde. Back a few years, Tribal
member and Grand Meadows ho
meowner Perri McDaniel was one
of the first to put her name on a
list for 'stick-built' houses antici
pated for a mixed-use development
on the Tribes' Risseeuw property,
a block north of Grand Meadows.
Now, of course, the property is be
ing considered for the Tribes' new
pow-wow grounds.
While McDaniel's hopes for a tra-
enues that we may want to take."
She suggested that "the Tribes can
be like a broker between a Tribal
member and lender."
In addition, though no decisions
have been finalized regarding a lo
cal bank for Grand Ronde and the
Tribe, it is possible that the branch
could handle mortgages, said Harjo,
who also cautioned, "There's a lot of
expertise needed to do mortgages."
Typical costs to refinance include
a one percent fee to HUD, the fed
eral housing authority which guar
antees the loans, one percent to
Wells Fargo, the lender, and a $220
fee to the escrow company. "My av
erage loan amount is $70,000," said
Harjo. "The average cost is $1,700."
All fees can be included in the loan.
Refi loans all close within 60 days,
according to Harjo, and "normally
can be done in 30-45 days, subject
to market conditions."
To successfully refinance a home,
"it's very important to know what
their goals are." Refinancing a 30
year loan, or to a 30-year loan, will
bring payments down as low as
they'll go, but homeowners will be
making those payments for a long
time.
In addition, something not gen
erally recognized, is that mortgage
payments are weighted more to the
interest side at the beginning of each
mortgage and more toward the
principal side at the end. By refi
nancing, home owners effectively
start the mortgage over and again
see the interest part of their pay
ments at the highest level and prin
cipal at the lowest.
By refinancing to a 15-year mort
gage, the rate will be lower but
monthly payments will be
higher, though for a shorter
period of time. Looking at
the total amount a home
owner pays over the life of
the loan is generally a pretty
shocking dose of reality. In
terest for the life of a mort
gage more than doubles the
cost of a home.
Factors like the market for
reselling the homes, and the
percent of your income that
goes to housing costs (30 per
cent is about right) should
play an important part in
the mortgage decision.
But with those in mind,
one might take a 30-year
loan with lower monthly pay
ments if selling the house is
in the near to middle future,
because the home's next buyer will
pay off the bulk of the mortgage.
For those who intend to stay in their
houses, a 15-year mortgage,
though a little harder to keep up
with month to month, allows you to
buy the house for substantially less
money in the long run.
With all that said, the Tribal Hous
ing Authority retains the profession
als in the field, and is a good place
to ask for advice on buying or refi
nancing homes on Tribal property.
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Sports Willamina High School
sports are as thrilling as ever this
year, whether it's 11th grade halfback
Bryan Fendall (left) as he outruns an
Amity defender on Friday, September
26, or the high flying Senior Caitlin
Zimbrick (right) as she prepares to
spike the ball on a Friday, October 8
volleyball matchup with Gaston.
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