The HUD 184 loan guarantee program: Much of the land in Indian country — some 55 million acres — is held in trust by the federal government. In enacting the Housing and Community Development Act of 1992 established a Native American Housing Loan Guarantee Program — Section 184 of the act— administered by the Department of Housing and Urban Development (HUD) through its Office of Native American Programs (ONAP), Offi ce of Loan Guarantee, based in Denver. As of September 30, 2001, the Office of Loan Guarantee had underwritten 864 loans valued at $84.7 million.
Through this program, HUD guarantees the mortgage loans made by approved lenders to eligible borrowers. The loan guarantee assures the lender that its investment will be repaid in case of foreclosure. Loans are originated and serviced by supervised lenders approved by ONAP.
Rural Housing Program Through HUD: The Section 502 Guaranteed Rural Housing Loan Program is designed to serve rural residents who have a steady, low or modest income, and yet are unable to obtain adequate housing through conventional financing. These loans enable low and moderate-income rural residents to acquire modestly priced housing for their own use as a residence through the purchase of a new or existing dwelling or the purchase of a new manufactured home. In this variation of the Section 502 program, RHS does not make a loan directly to an eligible borrower, but guarantees a loan made by a commercial lender. lender. This guarantee substantially reduces the risk for lenders, thus encouraging them to make loans to rural residents who have only modest incomes and little collateral.