Section 184 extending homeownership in Indian CountryElisa Blackminority homeownership, Native Americans, Section 184
In the Origin Myth, as told in the Navajo Blessing Way chant,
the first man's dwelling was a hogan constructed around four poles:
one of white shell, the second of abalone, the third of turquoise
and the fourth of black jet. Resting atop the four poles and
completing the structure was the rainbow. The builder sang the
planning hogan songs to the building materials. When the hogan
became too cramped to contain all of the first mans guests, he blew
on each of the poles, and the hogan grew.
Indian Country currently suffers from overcrowded dwellings and
a low level of overall homeownership - 33 percent, compared with 70
percent of the U.S. Caucasian population. In 1992, Congress, in an
effort to promote safe and sufficient housing on Indian tribal
land, created the Section 184 Indian Housing Loan Guarantee
Program. Section 184 creates home purchase and housing
rehabilitation opportunities for Native Americans and Alaska
natives. This program increases these groups' access to capital,
enhances credit and gives tribal housing agencies private funding
opportunities. Overall, Section 184 increases the opportunities for
homeownership and helps tribes create self-sustaining
The Section 184 loans are fixed-rate loans of 30 years or less.
They are available on tribal trust lands and can be used to buy a
home, build a new one, rehabilitate an existing structure or even
refinance a home. Section 184 has considerable advantages for both
homebuyer and lender.
To the buyer's advantage, Section 184 has a low down payment
requirement - 1.25 percent to 2.25 percent - and gift funds are
allowed. There are no maximum income limits, 100 percent financing
is available and no mortgage insurance is required. To ensure
successful homeownership, two things are essential for the buyer:
an excellent loan program, like Section 184, and homebuyer
counseling and education. For many Native Americans and Alaska
natives, Section 184 is enabling them to become the first
homeowners in many generations. The U.S. Department of Housing and
Urban Development (HUD) offers excellent homeownership education
modules. Many non-profit housing organizations also offer free
homebuyer education counseling and courses.
To ensure the lender against loss, Section 184 loans are
guaranteed by HUD. The underwriting requirements are flexible and
the loan is assumable and marketable. Freddie Mac, Fannie Mae and
Ginnie Mae all purchase Section 184 loans. Additionally, federal
home loan banks can also purchase Section 184 loans, and because
refinancing is available, Section 184 loans can generate repeat
Lenders wishing to make Section 184 loans need to complete
specialized training. HUD sponsors training seminars throughout the
country. Training brochures can also be downloaded and viewed from
the HUD Web site, www.hud.gov.
Lenders need to be approved by the Federal Housing
Administration's/HUD's single-family mortgage insurance program or
authorized by the U.S. Department of Veterans Affairs or the U.S.
Department of Agriculture.
Joanne Shenandoah wrote a song for the National American Indian
Housing Council. It embodies the spirit behind programs such as
Section 184. "Take them by the hand and show them all you
understand; they'll have a home someday, where family is the sacred
Elisa Black is director of marketing and communications for
the Esther Foundation, a Utah-based
non-profit organization that works to strengthen communities by
helping people to become homeowners. She can be reached at (866)
743-7795 or e-mail firstname.lastname@example.org.