Neighborhood Housing Services of Great Falls (NHSGF)is a lead partner in the Montana HomeOwnership Network, a statewide collaborative that provides housing counseling, education, and lending services to low- and moderate-income homebuyers throughout the state.

NHSGF was incorporated in 1980 with a belief that partnering among local residents, financial institutions, businesses, and local government could stop decline, promote reinvestment, and restore pride and confidence in the Original Townsite neighborhood. NHSGF has since expanded to five target neighborhoods for rehabilitation, as well as offering other programs citywide. NHS of Great Falls has developed a strong working relationship with the Missoula Housing Corporation and Resource Conservation and Development (part of the U.S. Department of Agriculture) Areas to provide home-ownership counseling and affordable loan products through-out rural Montana.
 
Great Falls is centrally located in the state, and NHSGF now serves the entire state with its home-ownership program. It provides Full-Cycle Lending services, including lending, homebuyer education, and counseling for first-time homebuyers. It became a NeighborWorks HomeOwnership Center in 1999 and has satellite offices in eight cities: Missoula, Shelby, Hamilton, Sidney, Butte, Joliet, Roundup and Libby.
 
The Montana HomeOwnership Network is an incorporated nonprofit that began after a regional Resource Conservation and Development Area (RC&D) of the USDA conducted a research program that identified affordable housing as the most urgent need in the state. The RC&D Area approached NHSGF for assistance in designing a program that would work throughout the state’s rural areas.

Program Purpose.  The Montana HomeOwnership Network (MHN) was created in 1998 to offer comprehensive and consistent affordable housing services to every resident in the state.

Service Delivery Partners.  Service delivery partners were recruited to teach homebuyer education and market the MHN lending programs. They include the eight regional RC&D programs, homeWORD in Missoula and Billings, NHSGF, and the Helena Area Housing Development Task Force. Some service delivery partners also provide foreclosure counseling and one-on-one housing counseling.

Support Partners.  Support partners include statewide partners such as the Montana Board of Housing, Rural Development of USDA, the Fannie Mae Partnership Office, the state HUD Office, and the Natural Resource Conservation Service. They provide capital and operational funds, and participate on the MHN board of directors.

Loans.  Reduced-rate mortgages are made available by private lenders through the Montana Board of Housing and Rural Development. A lender takes an application and packages the loans for a first mortgage, then sends the package to NHSGF for the down-payment/closing-cost assistance loan. Loan terms vary, according to the source of funding and household need, but range from due-upon-sale mortgages to five-year repayment periods.

NHSGF’s Role.  In addition to administering the down-payment and closing-cost assistance loans, NHSGF also acts as the overall administrator of the Montana HomeOwnership Network. NHSGF conducts accounting, oversees fundraising efforts, and provides marketing. NHSGF also provides training slots to NeighborWorks America's Training Institutes.

Foreclosure Prevention Loans.  Any lender or agency partner can refer homeowners to MHN partners for foreclosure prevention assistance. MHN partners conduct one-on-one counseling with the homeowner to determine the best course of action. Homeowners are occasionally advised to sell the house or create a loan workout with the lender, but MHN most often provides the home-owner with a foreclosure prevention loan to pay the past-due amount.
 
The foreclosure prevention loan is made affordable: The terms of the loan depend on the needs of the borrower. These loans can be for up to five years and for as much as $8,000. MHN stresses to network partners, especially lenders, that homeowners in default should be referred as soon as possible.

Board Meetings.  The Montana Housing Network board meets quarterly in various locations around the state.

Marketing.  MHN writes a statewide newsletter, which is distributed to all partners and home-owners in the network. It includes housing news, stories, network events and information, and homebuyer class schedules around the state. The network also created a TV commercial to air statewide, which encourages potential buyers to consider home ownership, and gives them a toll-free number to call for information. The toll-free number is answered by NHSGF, which provides callers with initial information, such as the local network organization in their areas.

Program Costs.  The operating costs of the Montana Housing Network are approximately $150,000 a year. This includes administration costs, loan processing, and resource development for the network. Each partner incurs its own staffing and education costs, which are covered by loan fees and grant funding. MHN is examin-ing ways to provide additional funding to partners.

Funding.  MHN has three main sources of funding. The first is annual funding from NeighborWorks America, of approximately $45,000. Second, each loan involves fees for service, equaling $350. This fee is split with the organization that provided the homebuyer education component for the borrower and MHN. Third, private dollars are raised from local and nationwide foundations and shared with the partners. MHN has also received a Rural Development grant in the amount of $150,000 to fund the program, which will be shared among the partners. Most fundraising is conducted by MHN staff employed by NHSGF.

• In its first five years, MHN helped 1,680 buyers from 175 communities buy homes. The homebuyer education program has served more than 5,000 participants.
   
• Through the network, MHN has prevented 45 loans from being foreclosed upon due to its counseling and foreclosure prevention loans.
   
• There are substantial economic advantages generated through the MHN, which benefits the state as a whole, as well as each county, city, network partner, and individual household.

• There are great benefits to creating a statewide affordable-housing partnership. Collectively, partner agencies are able to serve more households and can provide more efficient programs and services. It is a cost-effective strategy, which ultimately enables more households to reap the economic benefits of home ownership.
   
• Make sure that every partner is aware of and agrees upon the mission and program objectives. Working together helps organizations eliminate turf issues, and allows them to provide better services overall — but only if everyone is working together as a team. Define the mission so that many organizations can fit into it. NHSGF found it was best to focus on home ownership; neighborhood revitalization needs to be a goal of local organizations. Create a broad, inclusive mission, such as “providing home-ownership services, education and lending,” to allow for a larger partnership.
   
• Be inclusive while building the partnership. Identify all businesses and organizations related to home ownership in the state, and then ask them to join the network. Don’t forget to connect with agencies in rural areas. These areas are often underserved, and local organizations will best be able to connect with local residents.
   
• Most partners are not going to be able to provide services for free. Determine a way to pay organizations contributing to the network. Funding must be steady and long-term. Network partners can also create ways to collect fees for service. Nonprofit organizations, in particular, are going to need to create revenue to pay for the staffing and other costs incurred. NHSGF may start asking banks to pay a fee for each loan package they are involved in, which could help support the nonprofit partners.
   
• Clear, ongoing communications among network partners are vital to a successful partnership. Hold regular meetings for network representatives; a board format works best. Each representative can then update their service area on program growth or changes. A newsletter is also a helpful way to keep partners and participants informed.
   
• Creating a statewide partnership makes sense and is especially helpful for states with large rural areas and limited services. Partners can learn from one another and provide valuable support to each other. In addition, by pooling resources, each partner can provide more comprehensive services to more households.

Agency interview with: Sheila Rice