Housing Opportunities for Tribal Communities
Bay Bank, owned by the Oneida Nation, is a prominent HUD 184 lender in the Great Lakes area, offering financial support to underserved tribal communities. The government-to-government relationships, unique land status, and limited housing supply pose challenges for accessing financing. However, opportunities exist for tribal developers and borrowers to secure grants and subsidies for property construction and purchase, provided they demonstrate property management skills and the ability to pay. Qualified borrowers can assume loan liability, emphasizing the importance of credit history and income verification.
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Presented by Tanya Krueger Vice President Bay Bank Green Bay, WI tanya.krueger@baybankgb.com 920-490-7600 www.baybankgb.com Bay Bank is owned by the Oneida Nation Bay Bank is an approved HUD 184 Lender We are the largest HUD 184 originator and servicer in the Great Lakes area Tanya is an enrolled member of the Oneida Nation 2
Government to government relationships Unique land status Tribal Trust Land Allotted Trust Land Unrestricted Land Underserved markets Non-traditional credit Limited access/exposure to financing 3
1992 Housing and Community Development Act Annual funding by Congress Nationwide Program 4
THE TRIBE OR TDHE AS BORROWER THE TRIBE OR TDHE AS BORROWER 5
Limited Housing Supply Low turnover, vacancy rate Limited availability of developed lots Limited sales Modest homes Tribal developers Financing generally grant based Limited exposure/access to financial markets Subsidies Construction (grants, guarantees, interest rate) Down payment & closing costs 6
When the Tribe or TDHE borrowers for the construction/purchase of rental property, they must demonstrate: Property management skills Rental and maintenance plan Renters able to pay 7
These properties are eligible for assumption by qualified borrowers: Tribe/TDHE pays cash investment and loan payments during construction Qualified Borrowers able to assume After qualifying assumption, Tribe or TDHE is released from liability 8
Demonstrated ability to pay mortgage loan: Credit History (Dunn & Bradstreet) Sources of funds to close Income Liabilities 9
Coverage of debt service Skills, experience to undertake project Demonstration of need Marketing plan Audited financial statements 10
Evidence of authority to borrow Evidence of ability to obtain deficiency judgment Plans for projects exceeding 20 homes must be built in phases 11
1 1- -Unit $420,680 $467,176 $459,860 Unit 2 2- -Units $538,650 $591,077 $591,016 Units 3 3- -Units $651,050 $632,622 $751,063 Units 4 4- -Units $809,150 $894,953 $883,872 Units Michigan Minnesota Wisconsin Based on HUD s 2022 Loan Limits 12
$230,000 1 1- -Unit $1,498.46 $1,498.46 $230,000 Unit $420,000 2 2- -Unit $2,737.42 $1,368.71 $420,000 Unit $610,000 3 3- -Unit $3,975.73 $1,325.24 $610,000 Unit $800,000 4 4- -Unit $5,214.04 1,303.51 $800,000 Unit P&I Payment Monthly Cost Per Unit Required Down Payment $5,200 $9,500 $13,800 $18,000 Payments based on current rate of 6.875% for 30-year mortgage with APR of 7.077% 13
Mortgage loan designated specifically for Native Americans National Loan Program 23 entire states On/off reservation Fee simple land (on or off reservation) Tribal trust with an executed lease Individual allotment Individual ownership Fractionated ownership 14
Manual Underwrite by HUD No Credit Scoring NOTE: Applicants must have acceptable Credit Non-traditional credit acceptable Market interest rate Reduced monthly mortgage insurance Minimum down payment 1.25% if $49,999 or less 2.25% if $50,000 or more Seller contribution (up to exceed 6%) 100% of the cash requirement can be paid by an acceptable gift source Tribe Housing Authority Family 15
Contact an approved Section 184 Lender Visit our website at: https://www.hud.gov/program_offices/public_indian_h ousing/ih Questions: Section184@hud.gov 16
