NEZ PERCE TRIBAL HOUSING AUTHORITY (2024)

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NEZ PERCE TRIBAL HOUSING AUTHORITY

POLICY

CHANGE

NOTICE

Individual Development Account Program Policy

PLEASE SUBMIT COMMENTS ON OR BEFORE

APRIL 11, 2024, 4:30 PM

AT 208-843-2229

NPTHA@NEZPERCE.ORG

NPTHA

Individual Development Account (IDA)

Program Policy Draft REV 01/2024

SECTION I: PROGRAM DESCRIPTION

A. Purpose: The NPTHA Individual Development Account (IDA) Program is designed

to make it easier for lower-income families to reach their financial goals for

homeownership and developing economic independence. In order to accomplish this

goal, the Program design addresses three main areas:

1. Development of Positive Savings Habits;

2. Financial Literacy and Homebuyer Education Training and One-on-One

Counseling;

3. Asset Building.

B. Participation in the IDA Program is contingent on four factors:

Tribal Membership;

Attendance of Homebuyer Education or Homeowner’s Maintenance classes;

Monthly Deposits in the IDA account.

No early withdrawals, even for emergencies, are permitted.

C. In order to obtain the match money from the IDA Program, participants must attend

the required classes and make regular deposits into a savings account. If a participant

is planning on missing a session, they will be required to contact the Homebuyer

Counselor and provide a reasonable explanation for the absence. In addition, the

participant will have to meet with the Homebuyer Counselor to catch them up on the

material that was discussed in the session they missed. In no case can a participant

miss a class without making it up. Furthermore, participants will only be able to

access the match money if they make regular monthly deposits. Consequences for

missing monthly payments are as follows:

1. If the participant misses one month, they will be required to write a letter to the

Housing Counselor explaining why that deposit was missed. In addition, the

participant will be required to make up the deposit within the next two months

along with making the regular monthly deposit.

2. If a participant misses two months (consecutive or non-consecutive) they will

receive a letter from the Housing Counselor informing them that they need to

come and meet with the Housing Counselor to determine why the payment was

missed and to formulate a revised plan that will allow them to make up the

payments within two months. If the participant does not create a revised plan or

fails to catch up on their deposits under a revised plan, they will not be able to

access the match money.

Revised - January 8, 2008

If a participant misses three months (consecutive or non-consecutive), they will be

given a written letter and phone call informing them that they are no longer eligible

for the IDA Program. They will, however, be given an opportunity to meet with the

Housing Counselor to develop a plan that will work better for their individual

situation may be eligible for participation again after six (6) months if sufficient

funding is available.

Finally, if a participant makes an early withdrawal or withdraws money from their

IDA account for an unauthorized purchase, they will be terminated from the program.

Applicants are not eligible to re-enroll in the IDA program for a minimum of six

(months).

SECTION II: IDA PROGRAM FOR HOMEOWNERSHIP

A. Development of Positive Savings Habits

1. 2:1 Match: The IDA program will provide participants with a 2:1 match on their

savings up to a maximum of $5,000 $10,000 in matching dollars for closing costs

or down payment in the purchase of a home. This means for every $1.00 saved

by the participant the IDA Program will match $2.00.

2. The amount that a participant saves is determined by creating a savings plan. The

savings plan includes the savings goal, schedule of monthly deposits and the

length of time they will be in the program. Generally, participants must make

monthly contributions and save for at least six (6) months but no longer than

twenty-four (24) months. The minimum six-month time requirement for saving

is placed on the participants for two reasons:

•

The six-month time limit allows enough time to prepare participants for

homeownership. In most cases, it will take at least six months to prepare

their credit and perform all of the preliminary paperwork with the BIA that

will allow them to obtain a mortgage loan.

•

The time requirement allows participants enough time to develop positive

savings and budgeting habits. Throughout those six months they will be

required to make monthly deposits into their IDA savings account,

develop a workable budget that accounts for all of their monthly expenses

as well as their savings goals and develop a plan that allows them to live

within their means that will stick with them after they become

homeowners.

3. Lump sum deposits may be considered for participants who receive and will

utilize sporadic income for their savings. Although monthly deposits are key in

developing routine saving habits, utilizing sporadic income for saving is also

encouraged. A savings plan will be created noting the lump sum deposit in lieu of

the monthly deposits. Lump sum participants are still required to participate for a

minimum of six months and complete all other aspects of the program.

B. Housing Education & Counseling: In order to be eligible for the program,

participants will be required to complete appropriate training courses and housing

counseling activities.

Revised - January 8, 2008

1. Homeownership: In order to be eligible for the homeownership matching

program, participants will be required to attend the Homebuyer Education (HBE)

class. The HBE program provides participants with valuable information relating

to budgeting skills, lending, housing options, credit repair and maintenance,

working with IHS and the BIA, and responsible homeownership. This training

accomplishes three main goals.

•

Empowers participants with the information they need to be informed

consumers of both lending products and different types of housing;

Informs participants on the different land types and applicable rules; and

Improves the current level of housing on the Reservation.

2. Housing Counseling: Monthly housing counseling will be provided to ensure

compliance with the participant’s progress in the IDA Program.

C. Account Structure: The IDA Program and the participant will hold the participants

IDA deposits jointly. Joint Ownership has two benefits over individual ownership.

Since the consequences are so severe for early withdrawal for an unauthorized

purchase, joint ownership requires the participant to speak with the IDA coordinator

Housing Counselor about their reasons for making the withdrawal. This will allow

them the opportunity to obtain counseling on whether this is the best option for them

at this time. Joint ownership also allows the account holding bank the opportunity to

send account statements both to the Housing Counselor and the participant. This

makes tracking the account more efficient.

The match account is held in the name of the IDA Program. The participant does not

have access to the match account since the money will be paid directly to the vendor

once the participant makes a qualified purchase. This prevents the participant from

incurring any tax liability based on receipt of the match amount.

The participant will receive a monthly bank statement of their IDA deposits directly

from the bank. The NPTHA will send an additional statement showing the

participant’s deposits and the IDA matching funds to show the accumulative savings

amount. Receiving two statements allows the participant the opportunity to see how

their money is growing toward their goal.

D. Qualified Purchases: When it comes time for the IDA participant saving for

homeownership to use their savings, they will consult with the IDA coordinator and

the Housing Counselor to insure that their purchase is a qualified expense and to

insure that they are financially ready to incur the obligation. A list of qualified

expenses follows:

1. Down Payment on the home

2. Closing Cost for the home loan

3. Rehabilitation Expenses associated with purchasing an existing home.

Revised - January 8, 2008

When it is determined that the costs are allowable, the Housing Counselor will

prepare a written recommendation and justification to the NPTHA Executive Director

for approval and issuance of a check.

E. Program Eligibility:

CATEGORY

ELIGIBILITY CRITERIA

Tribal Affiliation

Enrolled Nez Perce Tribe Member

Property Location

On the Nez Perce Reservation (according to the Treaty of 1855)

First Time

Homebuyer

Had no ownership in a residence during the 3-year period prior to the date

of application to the NPTHA for MFA; or

Owned a principal residence not permanently affixed to a permanent

foundation, or owned property not in compliance with building codes,

which cannot be brought up to code, for less than the cost of constructing a

permanent structure.

Income ****

Must be low income according to HUD National Low-income standards and

not exceed 80% of median income.

Unit Condition

Must be in standard condition or rehabilitated to standard condition with

financing. Used manufactured homes are not eligible if they have to be

relocated or do not meet building codes.

Counseling

Must agree to participate in housing counseling, homebuyer education

class and one-on-one counseling.

Insurance

Must be willing to pay for include homeowner’s insurance in purchase.

Residence

Must use home as primary residence (at least 9 months per year)

Debt/Credit

Must have no outstanding obligations to the NPTHA and must meet HUD

184 creditworthiness criteria. *

Mortgage ready

Must be able to become mortgage ready within 24 months or with

applicable programs requirements.

One-time Assistance

IDA matching may only be used one time for down payment assistance.

1. Must demonstrate at least two-years recent employment stability.

*Existing NPTHA renters who vacate their rental to purchase a home are required to make

sufficient arrangements to pay for any anticipated move-out repairs/cleaning charges before

receiving IDA match funds. Preliminary inspections and cost estimates may be necessary. If

vacated balance is not paid in full, collection action will be utilized until balance is paid in

full. eligible for the match under a promissory note until all vacated charges are

zeroed out with the NPTHA. They will initially sign a promissory note for the match

amortized for a term not to exceed five years. Once the NPTHA determines there are

no charges or there are minor charges to the tenant, the promissory note will be

Revised - January 8, 2008

revised to reflect repayment of the charges and a deferment of the balance over a

specified term.

Only one Nez Perce Tribal member per household is eligible to participate

SECTION III: IDA PROGRAM FOR HOME REPAIR/IMPROVEMENTS

A. Development of Positive Savings Habits

1. 1:1 Match Saving for Home Repair/improvement: The IDA program will

provide participants with a 1:1 match on their savings up to a maximum of $3,000

$5,000 in matching dollars for home repairs or improvements. This means for

every $1.00 saved by the participant, the IDA Program will match $1.00.

2. The amount that a participant saves is determined by creating a savings plan. The

savings plan includes the savings goal, schedule of monthly deposits and the

length of time they will be in the program. Generally, participants must make

monthly contributions and save for at least three (3) months but no longer than

twelve (12) months. The three month minimum savings requirement allows

participants enough time to develop positive saving and budgeting habits.

Throughout the three months, participants will be required to make monthly

deposits into their IDA savings account, develop a workable budget that accounts

for all of their monthly expenses as well as their savings goals and complete the

home maintenance/repair class. These skills are designed to improve participants

ability to manage home maintenance and repair responsibilities.

3. Lump sum deposits may be considered for participants who receive and will

utilize sporadic income for their savings. Although monthly deposits are key in

developing routine saving habits, utilizing sporadic income for saving is also

encouraged. A savings plan will be created noting the lump sum deposit in lieu of

the monthly deposits. Lump sum participants are still required to participate for a

minimum of three months and complete all other aspects of the program.

B. Home Maintenance Education & Counseling: In order to be eligible for the program,

participants will be required to complete appropriate training courses and housing

counseling activities.

Home repair/maintenance: In order to be eligible for the home

repair/maintenance matching program, participants will be required to attend a

Homeowner’s Maintenance class. This training accomplishes two main goals.

•

Empowers participants with the information they need to be pro-active in

planning and budgeting for home repairs and improvements and

Improves the current condition of housing on the Reservation.

4. Housing Counseling: Monthly housing counseling will be provided to ensure

compliance with the participant’s progress in the IDA program.

C. Account Structure: The IDA Program and the participant will hold the participants

IDA deposits jointly. Joint Ownership has two benefits over individual ownership.

Since the consequences are so severe for early withdrawal for an unauthorized

Revised - January 8, 2008

purchase, joint ownership requires the participant to speak with the IDA coordinator

about their reasons for making the withdrawal. This will allow them the opportunity

to obtain counseling on whether this is the best option for them at this time. Joint

ownership also allows the account holding bank the opportunity to send account

statements both to the Housing Counselor and the participant. This makes tracking

the account more efficient.