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CLTC enhancing loan guarantee initiative

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Just as the rules allowing for commercial leases are expected to be adopted by next month, the Chamorro Land Trust Commission is also moving forward on another set of rules set to strengthen its loan guarantee program to help people build homes.  The Chamorro Home Loan Guarantee Program has been around since the inception of the Chamorro Land Trust Law back in 1994.

"The Chamorro Home Loan Guarantee Program allows the Chamorro Land Trust to help people get the loans they need to build their homes," explained Department of Land Management director Michael Borja, "because the land is not owned by the lessee it's owned by the Chamorro Land Trust, most banks require some kind of guarantee for that since they can't mortgage the land." And according to the director, while the program has been around for about two decades, rules were never in place and only recently were policies set.

"And these rules and regulations give it more strength not only for the guarantor, which is the Chamorro Land Trust, but also sets down the rules for the lender and the borrower. And it's all in an effort to make sure we're strong financially in that area - that the money that are being used to guarantee the funds are being responsibly cared for and the whole program has some credibility and integrity, especially because it is something that gets audited," Borja added.

He adds having these rules in place are important because of the $9 million worth of loan guarantees that the CLTC needs to keep safe. "So we want to make sure we're all protected and we're protecting the fund, because the fund is the people's fund, not mine and we have to have these kind of rules to protect that, and to also make sure it's viable that people coming down in the future who are trying to get loans to build their homes," he said.

Borja says the trust currently has 2,500 leases for agricultural and residential with 8,600 people on the waiting list - a list that dates back all the way to 1995. "And we're looking to move forward in a quite a few number of ways pretty soon, where we're going to try to develop subdivisions that will have infrastructure and then homes, when we start to put people in these homes and when they try to buy these homes, they'll probably need some loan guarantees, as well," he said.

He adds while guarantees were done before as part of the program, they mostly were for disaster relief loans. The rules were adopted by the Commission on Thursday, which will begin the administrative adjudication process.

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