What is the Section 184 Loan Guarantee Program?
The Section 184 Loan Program was designed to provide access to mortgage financing to Native American and Alaskan Native tribal members. Section 184 home loans are guaranteed 100% by the Office of Loan Guarantee within HUD's Office of Native American Programs.
This guarantee encourages national and local banks to provide mortgage loans to Native Americans. The Office of Loan Guarantee works with a national network of lenders to increase Native access to home financing and to improve the value of Native investments.
Why Should I Use the Section 184 Loan?
There are many advantages to using a Section 184:
- Low Down Payment: 2.25% on loans over $50,000 and only 1.25% on loans under $50,000
- Low Interest Rates: based on market rates, not on applicant’s Credit Scores
- Manual Underwriting: The Program utilizes a hands-on approach to underwriting and approval opposed to automated decision-making tools.
- Growing National Network of Approved Lenders: Our network of approved lenders includes national companies and local banks to suit your needs. Our Lenders have also been trained on the unique circumstances of Native homeownership.
- Section 184 Upfront Loan Guarantee Fee and Annual Mortgage Insurance: A one-time 1.5% up front guarantee fee is paid at closing and can be financed into the loan. In addition, loans with a loan to value of 78% or greater will be subject to an annual .25% mortgage insurance premium.
- Protection from predatory lending: Our Program monitors the fees our approved lenders can charge Native borrowers. Section 184 loans cannot be used for Adjustable Rate Mortgages (ARMs).
- Knowledgeable Staff: Our staff understands the unique circumstances associated with lending on Native Lands and we work with borrowers to achieve home ownership and to avoid default and foreclosure.
What Can I use the Section 184 Loan for?
You can use the Section 184 Loan to:
- Purchase an Existing Home
- Construct a New Home (Site-Built or Manufactured Homes on permanent foundations)
- Rehabilitate a Home, including weatherization
- Purchase and Rehabilitate a Home
- Refinance a Home (Rate and Term, Streamline, Cash Out)
Section 184 loans can only be used for single family homes (1-4 units) and for a primary residence. Since 184 strives to increase homeownership to all Native Communities, the guarantee funds are reserved for primary residences rather than second or investment properties.
Where can I use the Section 184 Loan?
Participating Tribes determine the areas where the Section 184 loan can be used. Many states are eligible in their entirety while only select counties are eligible in other states.
To use the Section 184 Loan, you must be a currently enrolled member of a Federally Recognized Tribe.
Verification of enrollment will be required when applying for a Section 184 loan. Neither Section 184 nor our approved lenders can assist in this enrollment process. Contact your tribe for their enrollment requirements.
Before meeting with a lender, it is recommended that you prepare for the home buying process by attending a homebuyer class or counseling session. Understanding what it takes to qualify for a loan can help you prepare for meeting with a lender.
Although these classes are not mandatory, they are greatly beneficial to you. Some lenders or Tribes will even offer financial assistance to borrowers who attend these classes.
Find an Approved Section 184 Lender
Once you are ready to apply for a Section 184 loan, contact one of our approved lenders. All of our approved lenders have undergone training on the unique circumstances of Native Homeownership.
Are you a Lender or CDFI? View Lender Resources.
Are you a Tribe or TDHE? View Tribal Resources.