Buying a home remains an American dream for many, but it can seem impossible once you start digging into how much those mortgages really cost you. It’s important to take advantage of every possible tax break, incentive or “short cut” (legally) that you can. However, those who enrolled in a Native American tribe often overlook one of the most valuable resources available. If this is you or someone you know, it’s time to learn about Section 184.
Don’t confuse this with “Section 8” housing which unfortunately has a stigma surrounding it and is focused on anyone who qualifies as low income. Section 184 is a program designed exclusively for any member of a tribe regardless of financial situation. It’s an “Indian Home Loan Guarantee Program” that offers the lowest possible mortgage rate for first time Native home buyers. However, that’s just the beginning of the perks.
What You Get
When you start looking into 184, you’ll notice that it’s for buying property “on Native lands,” but don’t let this language confuse you. “Native land” can include entire states and doesn’t only mean reservations. There’s a lot of wiggle room here. Current rates are 2.25 percent for a down payment for purchases over $50,000. This shifts based on market rates, not your credit score.
All underwriting is manual, and there are more lenders being added to the network all the time. This means most national companies and banks can work with 184, so you’re not stuck with a no-name lender. Perhaps one of the best perks, there’s no mortgage insurance each month, and you’ll just pay a single up front 1.5 percent “guarantee fee” at closing.
For individual Native Americans, you can use 184 one time to either buy a new home, build a new home (manufactured homes count), rehabilitate a home, purchase as well as rehabilitate a home, or refinance a home. Plus, you also have access to a knowledgeable staff that can help you through the entire process. Purchasing a home can be overwhelming whether it’s your first or last, so it’s important to have the right team on your side.
Of course, many people aren’t Native but still want the best rates and experience. These tips don’t only apply to Natives but to everyone looking for a home. Knowledge in making a purchase will prevent regret and financial problems in the future. When buying a home, take your time and do your research. Reputable help is available, but start with getting a buyer’s agent so you know your best interests are the top priority. Don’t take everything into your own hands because some things are better left for the experts to tackle.