Native American Home Loans In El Paso

The Section 184 Indian Home Loan Guarantee Program is a mortgage loan program developed exclusively for American Indian and Alaska Native households, Alaska villages, tribes, and tribally designated housing institutions. Congress launched this program in 1992 to increase access to capital and facilitate homeownership in Native American communities.

The Housing and Community Development Act of 1992 created the Section 184 Loan Guarantee Program to make it easier for Native Americans who live on reservations to obtain a mortgage. Section 184 financing enables borrowers to purchase a property with a small down payment and flexible underwriting. Section 184 loans may be utilized for new construction, rehabilitation, purchasing an existing home, or refinancing on and off native grounds.

What is HUD Section 184?

Section 184 was enacted to provide private lenders with the necessary insurance to offer mortgage loans on reservations. Section 184 loans are developed exclusively for American Indian and Alaska Native families, Alaska Villages, Tribes, and tribally designated housing entities. 

The Office of Native American Programs administers them within the US Department of Housing and Urban Development. These loans may be utilized for new construction, rehabilitation, acquiring an existing home, or refinancing on or off tribe territory. Due to the special status of Indian lands, Section 184 is a program tailored specifically to tribal communities.

How does HUD Section 184 work?

Section 184 home mortgage loans issued to Native borrowers are backed by the Office of Loan Guarantee inside HUD’s Office of Native American Programs. The loan guarantee guarantees the full repayment of the lender’s investment in the event of foreclosure.

If the property is on tribal trust land, the qualified buyer collaborates with HUD and the Bureau of Indian Affairs to set up the house as a leasehold estate, making it a leased entity for the life of the mortgage plus an additional ten years. The mortgage requires approval from both departments, and in the event of a default, the lender will take possession of the lease rather than the actual property. The lender is not permitted to sell the property to anybody other than an eligible tribe member, the Tribe, or the Indian Housing Authority because it still belongs to the Tribe and is a part of the Trust.

The loan is restricted to single-family homes and loans with fixed rates of 30 years or less. The HUD Section 184 Indian Home Loan Guarantee program is for primary residence only. Commercial properties and adjustable-rate mortgages (ARMs) are ineligible for Section 184 financing. The maximum loan amount varies per county. 

Who is Eligible for HUD Section 184 Home Loans?

To qualify for a Section 184 loan, you must be a member of a federally recognized Native American or Alaskan tribe. Enrollment into a tribe is determined entirely by the tribal authority, which will often produce a card or letter verifying enrollment. When applying for a Section 184 loan, proof of tribal membership will be required. The participating Tribes are permitted to select whether Section 184 eligibility is confined to specific counties or encompasses the entire state.

Apply for Section 184 Loan with Capital Home Mortgage

Capital Home Mortgage is a direct lender and servicer in Texas. Call us at (915) 283- 3949 to speak with our Home Loan Specialists about Native American Home Loans in El Paso.