If you are a Choctaw Tribal Member that's interested in purchasing a property, you might be eligible for a Section 184 loan. Section 184 was established by Congress in 1992 and it helps Native American's throughout the United States secure home loans and purchase residential property. So why should you, as a Choctaw Tribal Member go through a Section 184 loan instead of using a traditional mortgage loan? Let's discuss the benefits and restrictions of Section 184 loans so that you understand whether it's the best option for you.
What are the benefits of a Section 184 loan versus a traditional loan?
Section 184 financing makes it easier for Choctaw Tribal Members and other Native Americans to secure financing for a residential property. With traditional loans, you need great credit and a large down payment to secure the best rates. While your actual credit score is not as important to the loan approval process, you must meet certain credit approval guidelines. Another benefit of Section 184 loan is the flexibility you gain with the ability to pay a 1% to 3% down payment and also get help with closing costs.
Instead of basing your mortgage interest rates mostly on credit, you'll instead get a standard interest rate that can save you thousands of dollars over the life of your loan. Your loan is also guaranteed by the US Department of Housing and Urban Development, (HUD) meaning that you don't need to pay mortgage insurance, like those who pay less than 10% down on a home must.
As you can tell, there are many benefits of selecting a Section 184 loan versus a traditional loan. On top of the low down payment, competitive mortgage interest rates, and mortgage insurance waiver, you can use Section 184 loans to purchase, refinance, rehabilitate, or construct on a property. There are however limits on where you can build since you must purchase a property that's within an Indian Servicing Area. Additionally, you cannot finance investment properties and land only properties.
With so many advantages to choosing a Section 184 loan, how can one get started?
The best way to get started with the Section 184 loan application and approval process are to work with a specialist who understands all the rules and requirements for the program. You need someone who knows how to locate property and get you approved for the home loan in the shortest amount of time possible.
Here are two articles on the many eligibility requirements that you must know for Section 184 loans that I highly recommend reading, Native American First-time Homebuyer Loan Program and Make Use of the Native American Loan Section 184 Program.
If you're considering buying a home using a Section 184 loan and would like help with where to begin, then send me an email or give me a call. I can walk you through the whole process from beginning to end, help you find an approved Section 184 lender, and secure the property that's right for your whole family. On top of it, HUD usually covers my fees, so you have nothing to lose and everything to gain!
Get in touch with me through email or phone and we would love to answer any questions you have about the program and explain how to purchase your next home through a Section 184 loan.