Trust Montana wouldn’t be able to provide permanently affordable home or farm ownership opportunity for Montanans without the expertise and cooperation of our local lenders. Lenders provide access to financing for buyers of CLT homes and farms. Due to the investment of grant subsidy in the projects to bring down the price for income-qualified buyers, most buyers can avoid paying private mortgage insurance (PMI), as the subsidy investment acts as a down payment.
Lenders on CLT properties require that ground leases include a ground lease rider, recorded at time of closing, that strips the income and resale restrictions of the home if the home is foreclosed on. This protects the lender’s investment in the home and the need for mortgage insurance.
Trust Montana provides information and educational materials for lenders interested in providing loans for CLT buyers. The Montana Board of Housing and Fannie Mae both guarantee PMI-free loans for CLT buyers when the difference between the purchase price and market price is 20% or more, or if the buyer brings enough of a down payment to close the gap.
Lenders interested in receiving more information about how to work with a CLT buyer can contact Trust Montana for a pamphlet and an in-person workshop by calling Hermina at (406)-201-5652.