In the Washington, DC area: 202/708-0685
Or contact your local HUD office
August 24, 2001
HUD HELPS BOOST AFFORDABLE HOUSING AND COMMUNITY DEVELOPMENT OPPORTUNITIES FOR NATIVE AMERICAN TRIBES
WASHINGTON - In an effort to stimulate affordable housing and community development for Native Americans, the Department of Housing and Urban Development today announced a new partnership with the Federal Home Loan Bank of Seattle to buy up to $100 million in HUD-guaranteed loans.
Today's announcement will help create an incentive for other financial institutions to extend financing to Native American communities. By guaranteeing these loans, HUD encourages a broader secondary market, generating further investment in these underserved communities.
"This is a win-win proposition," said HUD Secretary Mel Martinez. "HUD's guarantee permits Native Americans and Alaskan Natives to leverage their limited resources to provide desperately needed housing now rather than later."
Earlier this week, the Federal Housing Finance Board approved the innovative plan by the Federal Home Loan Bank of Seattle to purchase up to $100 million in loans nationwide that are guaranteed under Title VI of the Native American Housing Assistance and Self-Determination Act (NAHASDA).
Under Title VI of NAHASDA, HUD will guarantee 95 percent of the principal and interest due in the event of default. This additional security encourages the participation of banks that do not customarily serve reservations and other Native American or Native Alaskan areas. Today's announcement is expected to generate more interest in the program and will benefit other tribal leaders as they meet their communities' housing needs.
For example, Title VI loans funded affordable rental housing for eight families of the Asa'carsarmuit tribe in Mountain Village, Alaska - a community so remote, it is only accessible by boat, plane or dog sled. First National Bank of Anchorage provided $1.7 million in financing to the tribal corporation. The borrower pledged their current and future Indian Housing Block Grant funds as collateral.
NAHASDA reorganizes the system of Federal housing assistance to Native Americans by eliminating several separate programs and replacing them with a single block grant. The program is designed to assist and promote affordable housing opportunities for Native Americans and to ensure better access to private mortgage and capital markets.