Magazine article American Banker

Two Companies Focus on Loans to Native Americans

Magazine article American Banker

Two Companies Focus on Loans to Native Americans

Article excerpt

With mortgage lending to Native Americans living on reservations still slow, two lenders have stepped up their efforts in two states where they have successfully closed loans.

Norwest Mortgage said last week that it has closed mortgage loans on all nine reservations in South Dakota. First Americans Mortgage Corp., a subsidiary of AmeriResource Technologies Inc., Overland Park, Kan., said it will offer A-minus loan products to Native American home buyers in Oklahoma.

Borrowers living on trust lands have a hard time obtaining traditional financing in part because federal approval is required. Lenders are reluctant to underwrite loans when the title on the land cannot be transferred.

Norwest's program focuses on trust lands in South Dakota, while First Americans' program is designed for fee simple land, where the title of the land is held by the homeowner.

Des Moines-based Norwest has been making loans on Native American reservations in South Dakota under a Department of Housing and Urban Development loan guarantee program since 1997. That year Norwest and the Bureau of Indian Affairs established a program to streamline the loan approval process and increase homeownership of American Indians living on trust lands in Nebraska, North Dakota, and South Dakota.

Norwest closed the first mortgage loan on South Dakota tribal trust lands in early 1997. Since then it has closed 45 loans on reservations in the state. The largest concentration -- 14 -- was on the Rosebud reservation. …

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