Greg Austin
Carrington Mortgage Services is introducing Native American Section 184 loans for its retail lending clients.
“Section 184 loans are a great product in part because of their low cost compared to other loan programs,” Greg Austin, executive vice president of lending at Carrington Mortgage Services, said in the release. “They're becoming increasingly popular as Native Americans realize there's a product specifically designed for them, especially on tribal lands.”
The Section 184 Loan Guarantee Program was established by the U.S. Department of Housing and Urban Development's (HUD) Housing and Community Development Act in 1992 to address the shortage of mortgage lending to Native American and Alaska Native tribal members.
According to HUD, Section 184 loans are available to American Indians or Alaska Natives who are registered with a federally recognized tribe, Alaska village, or local corporation.
These mortgages are 100% guaranteed by the Loan Guaranty Office within HUD’s Office of Native American Programs to encourage lenders like CMS to provide mortgages to Native Americans.
For mortgages on tribal trust land, qualified borrowers lease the land from the tribe for 50 years.Currently, Section 184 mortgages are fully available in 24 states, including Oklahoma, Arizona, Colorado, Kansas, New Mexico, and Utah. In 14 states, including Texas, New York, and Connecticut, the loans are only available in certain counties and cities.
Loans offered through this program require a low minimum down payment (usually 2.25%, 1.25% for loans under $50,000).
Additionally, the program takes a hands-on approach to underwriting and approvals rather than using automated decision-making tools.
There is no annual loan guarantee fee for loans closed after July 1, 2023. Section 184 loans are only available for single-family homes (one to four units) and principal residences.
“In some cases, Native American homeowners are able to use gift funds or benefit from approved settlement cost assistance programs,” Austin says. “The programs truly help qualified clients purchase or refinance their homes. It's important that Native Americans have equal access to the American Dream: homeownership, and at Carrington, we're proud to help these qualified homeowners find a great home with a program created for their unique needs.”