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Mortgage lending on Native American reservations: Does a guarantee matter?

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  • Laderman, Elizabeth
  • Reid, Carolina

Abstract

The Section 184 Indian Home Loan Guarantee Program provides lenders with a 100 percent guarantee for mortgage loans to Native Americans residing on reservations belonging to tribes that have chosen to participate in the program. We find that Native Americans residing on trust land whose tribes have adopted Section 184 have a marginally statistically significantly higher loan approval rate than Native Americans residing on trust land whose tribes have not adopted Section 184. However, the statistical significance disappears once tribe fixed effects are included in the analysis, suggesting that underlying tribe characteristics correlated with the adoption of Section 184 are more important determinants of access to credit than is Section 184 per se.

Suggested Citation

  • Laderman, Elizabeth & Reid, Carolina, 2010. "Mortgage lending on Native American reservations: Does a guarantee matter?," Journal of Housing Economics, Elsevier, vol. 19(3), pages 233-242, September.
    • Handle: RePEc:eee:jhouse:v:19:y:2010:i:3:p:233-242
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    References listed on IDEAS

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    1. Ken Cyree & Keith Harvey & Michael Melton, 2004. "Bank Lending to Native American Applicants: An Investigation of Mortgage Flows and Government Guarantee Programs on Native American Lands," Journal of Financial Services Research, Springer;Western Finance Association, vol. 26(1), pages 29-54, August.
    2. Robert B. Avery & Glenn B. Canner & Robert E. Cook, 2005. "New information reported under HMDA and its application in fair lending enforcement," Federal Reserve Bulletin, Board of Governors of the Federal Reserve System (U.S.), vol. 91(Sum), pages 344-394.
    3. Barakova, Irina & Bostic, Raphael W. & Calem, Paul S. & Wachter, Susan M., 2003. "Does credit quality matter for homeownership?," Journal of Housing Economics, Elsevier, vol. 12(4), pages 318-336, December.
    4. Quercia, Roberto G. & McCarthy, George W. & Wachter, Susan M., 2003. "The impacts of affordable lending efforts on homeownership rates," Journal of Housing Economics, Elsevier, vol. 12(1), pages 29-59, March.
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    Cited by:

    1. Dimitrova-Grajzl, Valentina & Grajzl, Peter & Guse, A. Joseph & Todd, Richard M., 2015. "Consumer credit on American Indian reservations," Economic Systems, Elsevier, vol. 39(3), pages 518-540.
    2. Valentina Dimitrova-Grajzl & Peter Grajzl & A. Joseph Guse & Richard M. Todd & Michael Williams, 2018. "Neighborhood Racial Characteristics, Credit History, and Bankcard Credit in Indian Country," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 60(3), pages 410-441, September.

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