What Is the Mortgage Guarantee Program?

18 Oct

What Is the Mortgage Guarantee Program?

The Home Loan Guarantee Program, also referred to as Section 184, is a federal mortgage product for households of American Indian source and Alaska Native, and for tribes of Alaska cities or tribally designated areas of housing. The loan is guaranteed to the lending institution by the U.S. Department of Housing and Urban Development in the event of borrower default.


The U.S. Congress established the Mortgage Guarantee Program in 1992. The purpose of the loan program is to stimulate home ownership by making home purchase or home rehabilitation attainable for Native American community members.

Handling Entity

Native American Programs’ Office employs. The members oversee development of the program, grade control, loan underwriting and promotion. Representatives work as a go-between with tribal members creditors and government agencies. The office works to ensure safe, decent and affordable homes and opportunities are made accessible to Native American households.

How It Works

Borrowers using the plan benefit from flexible loan underwriting terms, a low down payment and a loan absolutely free of monthly mortgage insurance, which generally is assessed when loans are at 80 percent or more of the home purchase price. For loans of $50,000 or more, borrowers must earn a 2.25 percent down payment; 1.25 percentage for loans less than $50,000. Just one 1 percent loan guarantee fee, which a borrower may develop into his loan is assessed by HUD.

Eligible Projects

Borrowers may get a loan to buy an existing home, to construct a stick-built or manufactured home on a foundation, to rehabilitate a home, or to buy and rehabilitate a home. They may also refinance a loan; rate, term, cash-out and streamlined choices are available.

Additional Assistance

HUD recommends but does not require applicants to test with their housing division to find out whether homebuyer education courses are available to help them prepare for the loan and purchasing process. The loan may only be procured from a Section 184 lender. HUD operates six tribal offices at the United States, The Alaska office serves Alaska only. Oregon, Idaho and Washington residents are assisted by the Northwest office. The Southwest regional office serves residents of Arizona, California, New Mexico and Nevada. The Northern Plains office serves citizens of Colorado, Montana, North Dakota, Nebraska, South Dakota, Utah and Wyoming. The Southern Plains regionĀ is constituted of Kansas, Louisiana, Missouri, Oklahoma and Texas. From the Eastern/Woodlands region, residents from Alabama, Connecticut, Florida, Iowa, Massachusetts, Maine, Michigan, Minnesota, Mississippi, North Carolina, New York, Rhode Island, South Carolina, Virginia and Wisconsin receive help.

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